Final  Report   of   the 

Commission  on 
Industrial  Relations 


>rnia 

8,1 


THE  LIBRARY 

OF 

THE  UNIVERSITY 

OF  CALIFORNIA 

LOS  ANGELES 

EX  LIBRIS 
CLARENCE  ADDISON  DYKSTRA 


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FINAL  REPORT 


OF  THE 


Commission 


ON 


Industrial  Relations 


t 


WASHINGTON,  D.  C. 
1915 


Barnard  &  Miller  Print,  Chicago 
•137 


THE  COMMISSION  ON  INDUSTRIAL  RELATIONS. 


Frank  P.  Walsh,  Missouri,  Harris  Weinstock,  California. 

Chairman.  g  Thru8TON  Ballard,  Kentucky. 

John  R.  Commons,  Wisconsin.  JoHN  B  Lennon>  Illinoifi 

+   Florence  J.  Harriman,  New  York.  Jam£8  q-Connell,  District  of  Columbia. 

Richard  H.  Aishton,  Illinois.1  AugTIN  B  GarretsoNj  Iowa. 

Secretary:  Counsel: 

Lewis  K.  Brown.  William  O.  Thompson. 

Director  of  Research  and  Investigation: 
Basil  M.  Manlt. 

Extract  from  act  of  Congress  of  August  23,  1912,  creating  and  defining 
the  duties  of  the  Commission  on  Industrial  Relations. 

That  a  commission  is  hereby  created  to  be  called  the  Commission  on  Industrial 
Relations.  Said  commission  shall  be  composed  of  nine  persons,  to  be  appointed  by 
the  President  of  the  United  States,  by  and  with  the  advice  and  consent  of  the  Senate, 
not  less  than  three  of  whom  shall  be  employers  of  labor  and  not  less  than  three  of 
whom  shall  be  representatives  of  organized  labor. 

****** 

Sec.  4.  That  the  commission  shall  inquire  into  the  general  condition  of  labor 
in  the  principal  industries  of  the  United  States  including  agriculture,  and  especially 
in  those  which  are  carried  on  in  corporate  forms;  into  existing  relations  between 
employers  and  employees;  into  the  effect  of  industrial  conditions  on  public  welfare 
and  into  the  rights  and  powers  of  the  community  to  deal  therewith;  into  the  con- 
ditions of  sanitation  and  safety  of  employees  and  the  provisions  for  protecting  the 
life,  limb,  and  health  of  the  employees;  into  the  growth  of  associations  of  employers 
and  of  wage  earners  and  the  effect  of  such  associations  upon  the  relations  between 
employers  and  employees;  into  the  extent  and  results  of  methods  of  collective  bar- 
gaining; into  any  methods  which  have  been  tried  in  any  State  or  in  foreign  countries 
for  maintaining  mutually  satisfactory  relations  between  employees  and  employers; 
into  methods  for  avoiding  or  adjusting  labor  disputes  through  peaceful  and  con- 
ciliatory mediation  and  negotiations;  into  the  scope,  methods,  and  resources  of 
existing  bureaus  of  labor  and  into  possible  ways  of  increasing  their  usefulness;  into 
the  question  of  smuggling  or  other  illegal  entry  of  Asiatics  into  the  United  States  or 
its  insular  possessions,  and  of  the  methods  by  which  such  Asiatics  have  gained  and 
are  gaining  such  admission,  and  shall  report  to  Congress  as  speedily  as  possible  with 
Buch  recommendation  as  said  commission  may  think  proper  to  prevent  such  smug- 
gling and  illegal  entry.  The  commission  shall  seek  to  discover  the  underlying  causes 
of  dissatisfaction  in  the  industrial  situation  and  report  its  conclusions  thereon. 


'Appointed  Commissioner  March  17,   1915,  to  serve  the  unexpired  term  of 
Hon.  F.  A.  Delano,  resigned. 


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TABLE  OF   CONTENTS. 


Letter  of  transmittal   vii 


REPORT  OF  BASIL  M.   MANLY,   DIRECTOR   OF  RESEARCH 

AND  INVESTIGATION. 

Page. 
Letter  of  submittal  xi 

Introduction    7 . . .       1 

Method  and  character  of  investigation  5 

Classification  of  witnesses  upon  industrial  subjects 6 

Summary  of  conclusions  and  recommendations 8 

Labor  conditions  in  the  principal  industries,  including  agriculture..  8 

Existing  relations  between  employers  and  employees 16 

Causes  of  industrial  unrest 22 

Unjust  distribution  of  wealth  and  income  vJ3b 

Unemployment  and  denial  of  opportunity  to  earn  a  living 33 

Denial  of  justice  38 

Denial  of  the  right  of  organization   80 

Conclusions  and  recommendations  92 


(S 


I. )  Industrial  conditions  of  adult  workmen  in  general  industries C^^) 

Wages 92 

Hours  of  labor 94 

Safety  and  sanitation  95 

Housing  96 

II.     Women  and  children  in  industry 99 

III.  Industrial  conditions  and  relations  on  public  utilities 103 

General    > 103 

Telegraph    104 

Telephone  106 

The  Pullman  Company 108 

Railroads    Ill 

IV.  Industrial  conditions  in  isolated  communities 113 

V.     The  concentration  of  wealth  and  influence 116 

VI.     The  land  question  and  the  condition  of  agricultural  labor 127 

VII.     Judicial  settlement  of  labor  claims  and  complaints 133 

VIII.     The  law  relating  to  trade  unions  and  industrial  disputes 135 


787496 


IV 

Page. 

IX.     The  policing  of  industry   139 

The  origin  of  industrial  violence 139 

State  constabulary  149 

Free  speech  150 

X.    The  conditions  and  problems  of  migratory  laborers 156 

XI.    Unemployment 161  ■ 

Extent  and  character  of  unemployment  161 

Existing  conditions  of  employment  166 

Existing  agencies  for  employment  170 

Public  employment  agencies  177 

XII.    Organization,  methods  and  policies  of  trade  unions 183 

XIII.  Organization,  methods  and  policies  of  employers'  associations 187 

XIV.  Joint  agreements 191 

XV.    Agencies  of  mediation,  investigation  and  arbitration 194 

Proposed  plan  of  a  National  system 196 

Organization    196 

Powers,  duties  and  jurisdiction  198 

Cooperation    201 

XVI.     Industrial  conditions  and  the  public  health — Sickness  insurance. .  202 

XVII.  Education  in  relation  to  industry  (See  Report  of  Commissioner 
John  B.  Lennon  on  Industrial  Education,  p.  265) 

XVIII.  Scientific  management   209 

Possible  I  i<nefits  to  labor  and  society  210 

Diversities  and  defects  212 

General  labor  problems   227 

Conclusions    233 

XIX.     Prison  Labor  234 

XX.     Immigration 235 

XXI.     Labor  conditions  in  American   colonial   possessions 238 

XXII.     Chinese  exclusion  243 

Constructive  suggestions: 

Changes  in  the  law  243 

United  States  Commissioners   245 

The  judicial  system  246 

General  administration   246 

Selection  of  inspectors  247 

Chinese  interpreters   248 

Staff  organization  at  Washington  249 

Salary  plan  250 

Redistricting    251 


Page. 
ADDITIONAL   FINDINGS   OF  FACT,    CONCLUSIONS   AND 
RECOMMENDATIONS 253 


REPORT  OF  COMMISSIONER  JOHN  B.  LENNON  ON 
INDUSTRIAL  EDUCATION. 

Demand  for  industrial  education   26& 

Control  of  vocational  schools 269 

General  recommendations   269 

Continuation  or  part-time  schools 272 

Teachers   273 

Conclusions    274 


SUPPLEMENTAL  STATEMENT  OF  COMMISSIONERS  JOHN  B. 
LENNON  AND  JAMES  O'CONNELL. 

Criticisms    not    justified    279 

Strong  organizations  the  cure  280 

The  evidence  282 

Extent  of  unrest 283 

New  Governmental  machinery  unwise   284 

The  one  true  remedy   286 

The   public's  duty    288 


SUPPLEMENTAL  STATEMENT  OF  COMMISSIONER 
AUSTIN  B.  GARRETSON    291 


SUPPLEMENTAL  STATEMENT  OF  CHAIRMAN  FRANK  P. 
WALSH 297 


REPORT  OF  COMMISSIONERS  JOHN  R.  COMMONS  AND 
FLORENCE  J.  HARRIMAN. 

Enactment,  interpretation  and  enforcement  of  labor  law 307 

Industrial  commissions  310 

Advisory  representative  council 316 

Civil  Service  and  comments  on  preceding  paragraphs \  . .   321 


VI 

Page. 

Commissions  and  class  conflicts     325 

Investigations    340 

Rules  and  regulations 346 

Review  by  commission  351 

Court  review    352 

Testimony    353 

Continuous  industry,  employment  and  insurance 354 

Police  and  military  355 

Legal  aid 357 

Legislation    359 

Supreme  Courts   361 

Mediation  and  minimum  wage   364 

Trade  disputes    377 

Foundations    387 

Subsidies    388 

Federal  fund  for  social  welfare  389 

Immigration   396 

Farmers  and  farm  laborers   398 

Corporation  control  401 

Dissenting  opinion  of  Commissioner  Harris  Weinstock 404 


REPORT  OF  COMMISSIONERS  WEINSTOCK,  BALLARD  AND 

AISHTON. 

Points  of  dissent  407 

Employers'  objection  to  organized  labor,  fear  of — 

Sympathetic  strikes    415 

Jurisdictional  disputes  415 

Labor  union  politics   419 

Contract  breaking    419 

Restriction  of  output   421 

Prohibition  of  use  of  nonunion  made  tools  and  material 425 

Closed  shop   425 

Contests  for  supremacy  between  rival  unions   428 

Acts  of  violence  428 

Apprenticeship  rules  435 


SUPPLEMENTAL  STATEMENT  OF  COMMISSIONER 
S.  THRUSTON  BALLARD  443 


LETTER  OF  TRANSMITTAL. 


Commission  on  Industrial  Relations. 

Chicago,  Illinois,  August  23,  1915. 
To  the  Sixty-fourth  Congress: 

On  behalf  of  the  Commission  on  Industrial  Relations,  I 
have  the  honor  to  transmit  herewith  its  final  report. 

The  assembling  of  facts  in  the  report  of  the  staff,  from 
the  records  of  our  public  hearings  and  the  reports  of  investi- 
gators, under  the  direction  of  Mr.  Basil  M.  Manly,  might 
well  be  taken,  in  my  opinion,  as  a  model  of  efficiency  and 
scientific  treatment  by  Governmental  departments. 

The  plan  of  submitting  none  but  undisputed  facts  in  the 
final  report  of  the  Commission  has  been  faithfully  adhered  to. 

No  statement  or  conclusion  of  fact  adverse  to  the  attitude 
or  interest  of  any  person  or  group  of  persons  is  submitted, 
except  as  declared  or  assented  to  by  the  person  or  by  the 
individuals  comprising  the  group  affected.  Thus,  for  per- 
haps the  first  time  in  the  history  of  our  Government,  the 
facts  in  relation  to  conditions  in  the  industries  examined  and 
the  relations  inquired  into,  are  placed  beyond  the  realm  of 
controversy,  and  established  upon  the  solid  and  scientific 
basis  of  ascertained  and  indisputable  fact. 

It  is  believed  that  the  work  of  the  Commission  has  been 
conducted  in  a  spirit  of  social  justice  and  an  earnest  desire 
to  serve  the  public,  by  bringing  into  the  light  the  facts  re- 
garding the  industrial  relations  of  the  country.  For  the 
creation  of  this  spirit,  as  well  as  for  an  earnest  insistence 
that  the  education  of  the  public  should  be  the  keynote,  I  feel 
that  full  credit  should  be  accorded  Mr.  George  P.  West;  and 
that,  in  addition  thereto,  he  should  be  credited  with  the  in- 
spiration and  planning  of  many  of  the  most  effective  public 
hearings  of  the  Commission. 

Respectfully, 

Frank  P.  Walsh, 
Chairman. 


Report  of  Basil  M.  Manly 

Director  of  Research  and  Investigation 

Embodying  the  Findings  of  Fact,  Conclusions,  and  Recommendations  of  the 

Staff,  based  upon  their  Investigations  and  the  Testimony  of 

Public  Hearings. 


• 


LETTER  OF  SUBMITTAL. 


Chicago,  Illinois,  August  9,  1915. 
To  the  Commission  on  Industrial  Relations: 

I  have  the  honor  to  submit  herewith  my  report,  which  has 
been  prepared  by  direction  of  the  Commission  as  a  summary 
and  interpretation  of  the  evidence  contained  in  the  public 
hearings  of  the  Commission  and  the  reports  of  the  Staff,  to- 
gether with  suggestions  for  action  designed  to  remedy  such 
evils  and  abuses  as  have  been  developed  by  investigation. 

In  the  preparation  of  this  report  I  have  directed  my  atten- 
tion primarily  to  the  most  important  question  placed  before 
the  Commission  by  Congress,  namely,  "the  underlying  causes 
of  dissatisfaction  in  the  industrial  situation."  I  have,  how- 
ever, attempted  to  cover  as  adequately  as  possible  all  the  ques- 
tions embodied  in  Section  4  of  the  Act. 

A  few  words  with  regard  to  the  method  of  preparation 
may  be  of  value :  The  policy  of  the  Commission  in  entrusting 
certain  important  subjects  to  the  members  of  the  Staff  for 
investigation  under  the  general  supervision  of  the  Director 
has  been  continued  throughout.  The  members  of  the  Staff 
who  had  charge  of  definite  subjects  have  made  their  final 
reports  embodying  the  results  of  their  investigations  and  the 
pertinent  parts  of  the  testimony  before  the  Commission. 
These  reports  have,  as  far  as  possible,  been  accepted  as  the 
basis  for  the  statements  and  recommendations  contained  in 
this  report.  It  is  only  fair,  however,  to  state  that  in  certain 
respects  they  have  been  modified,  largely  as  a  result  of  the 
discussion  which  took  place  when  these  reports  were  presented 
to  the  Commission  in  tentative  form.  Nevertheless,  in  every 
case  the  substance  and  essential  ideas  of  each  investigator's 
report  have  been  retained. 

The  enormous  mass  of  testimony  heard  by  the  Commission 
has  been  drawn  upon  freely.    In  using  this  testimony  I  have 


Xll 

been  guided  by  the  principle  of  quoting  only  statements  made 
by  the  party  to  whom  such  evidence  would  be  unfavorable  or 
by  persons  who  were  clearly  nonpartisan.  For  example,  in 
the  criticism  of  the  attitude  and  actions  of  employers  only  the 
testimony  given  by  employers  or  their  agents  has  been  quoted ; 
the  testimony  of  labor  representatives  being  used  only  to  show 
the  attitude  of  the  workers. 

In  addition,  I  have  utilized  to  a  very  large  extent  the  reports 
of  other  Governmental  agencies  not  only  as  sources  of  original 
information  but  as  a  check  upon  the  statements  and  conclu- 
sions contained  herein.  In  relation  to  a  few  subjects,  indeed, 
the  information  already  collected  made  it  unnecessary  for  the 
Commission  to  conduct  investigations  of  its  own. 

This  report  should  properly  be  known  as  the  report  of  the 
Staff,  except  that,  as  noted  above,  I  feel  it  necessary  to  assume 
personal  responsibility  for  certain  modifications  which  have 
been  made  from  the  original  reports.  I  wish  to  state,  how- 
ever, that  I  have  drawn  most  largely  upon  the  following 
reports,  which  are  submitted  herewith,  with  the  suggestion 
that  Congress  be  requested  to  print  them  as  supplements  to 
this  report: 

W.  Jett  Lauck  : 

Analysis  of  Economic  Causes  of  Unrest. 

Edgab  Sydenstricker: 

Labor  Conditions  in  American  Industry. 

Christopher  T.  Chenery: 

The  Telephone  and  Telegraph  Industry. 
Labor  Conditions  in  Porto  Rico. 

Marie  L.  Obenauer  : 

Women  in  Industry. 
Interstate  Competition. 

Gertrude  Barnum  : 

Enforcement  of  Laws  Regulating  Working  Hours 
of  Women  in  Wisconsin. 


Xlll 

George  P.  West  : 

Labor  Conditions  in  Colorado. 

William  P.  Harvey  : 

Labor  Conditions  in  the  Black  Hills. 
Labor  Conditions  in  Los  Angeles. 

Charles  W.  Holman: 

Preliminary  Report  on  the  Land  Question. 

John  L.  Coulter: 

Agricultural  Labor  and  Tenancy. 

William  M.  Leiserson  : 

Unemployment. 

Peter  A.  Speek  : 

Conditions  in  Labor  Camps. 
Labor  Complaints  and  Claims. 
Migratory  Workers. 

George  E.  Barnett: 

Joint  Agreements. 

George  E.  Barnett  and  D.  A.  McCabe  : 
Mediation  and  Arbitration. 

Leo  Wolman  : 

Extent  and  Growth  of  Labor  Organizations. 

J.  Wallace  Bryan  : 

Trade  Union  Law. 

Edwin  E.  Witte: 

Injunctions  in  Labor  Disputes. 

Robert  F.  Hoxie  : 

Scientific  Management  and  Labor. 


XIV 

B.  S.  Warren  : 

Industrial  Conditions  and  the  Public  Health. 

Luke  Grant  : 

Violence  in  Labor  Disputes  and  the  Policing  of 
Industry. 

The  National  Erectors'  Association  and  the  In- 
ternational Association  of  Bridge  and 
Structural  Iron  Workers. 

Redmond  S.  Brennan  and  Patrick  F.  Gill  : 

The  Inferior  Courts  and  Police  of  Paterson,  N.  J. 

Edward  A.  Fitzpatrick  : 

Chinese  Exclusion. 

In  addition  to  those  named  above,  the  following  members  of 
the  Staff,  who  have  performed  exceptional  service  and  whose 
reports  have  to  some  extent  been  used  directly,  should  be 
mentioned : 

Henry  Winthrop  Ballantine,  Charles  B.  Barnes,  Francis  H. 
Bird,  E.  H.  Busiek,  W.  J.  Coyne,  Nelle  B.  Curry,  Alexander 
M.  Daly,  F.  S.  Deibler,  Noel  T.  Dowling,  H.  E.  Hoagland, 
Carl  Hookstadt,  B.  F.  Moore,  Daniel  T.  O'Regan,  M.  O'Sulli- 
van,  Selig  Perlman,  Sumner  Slichter,  George  L.  Sprague  and 
Inis  Weed. 

Special  mention  should  be  made  also  of  Charles  J.  Stowell 
and  Elizabeth  A.  Hyde,  whose  work  in  research  and  in  the 
digesting  of  testimony  has  been  invaluable. 

The  success  of  the  public  hearings  was  due  in  large  meas- 
ure to  the  courage,  tact,  and  good  humor  of  Thomas  J.  Egan, 
who  performed  the  difficult  duties  of  Sergeant  at  Arms  for 
the  Commission. 

I  wish  to  express  my  appreciation  of  the  generous  co-opera- 
tion of  the  Secretary,  Mr.  Lewis  K.  Brown,  upon  whose  ex- 
ecutive ability  and  tactful  administration  of  the  Commission's 
affairs  the  work  of  the  Staff  in  large  measure  depended.    I 


XV 

wish  also  to  express  to  the  Commission  my  acknowledgement 
and  appreciation  of  the  unusnal  freedom  which  has  been  ac- 
corded me  in  the  administration  of  the  work  of  research  and 
investigation,  and  in  the  conduct  of  the  public  hearings. 

Respectfully, 

Basil  M.  Manly. 

Director. 


REPORT  OF  BASIL  M.  MANLY,  DIRECTOR  OF 
RESEARCH  AND  INVESTIGATION. 


INTRODUCTION. 

The  question  of  industrial  relations  assigned  by  Congress 
to  the  Commission  for  investigation  is  more  fundamental  and 
of  greater  importance  to  the  welfare  of  the  Nation  than  any 
other  question  except  the  form  of  our  Government.  The  only 
hope  for  the  solution  of  the  tremendous  problems  created  by 
industrial  relationship  lies  in  the  effective  use  of  our  demo- 
cratic institutions  and  in  the  rapid  extension  of  the  principles 
of  democracy  to  industry. 

The  immediate  effects  of  the  form  and  character  of  indus- 
trial organization  are,  however,  greater  and  closer  to  the  lives 
and  happiness  of  all  classes  of  citizens  than  even  the  form  and 
character  of  our  political  institutions.  The  ordinary  man, 
whether  employer  or  worker,  has  relatively  little  contact  with 
the  Government.  If  he  and  his  family  are  well-fed,  well- 
housed,  and  well-clothed,  and  if  he  can  pay  for  the  education 
of  his  children,  he  can  exist  even  under  an  autocratic  monarchy 
with  little  concern,  until  some  critical  situation  develops  in 
which  his  own  liberty  is  interfered  with  or  until  he  is  de- 
prived of  life  or  property  by  the  overwhelming  power  of  his 
tyrannical  ruler.  But  his  industrial  relations  determine  every 
day  what  he  and  his  family  shall  eat,  what  they  shall  wear, 
how  many  hours  of  his  life  he  shall  labor  and  in  what  sur- 
roundings. Under  certain  conditions  where  his  individual  or 
corporate  employer  owns  or  controls  the  community  in  which 
he  lives,  the  education  of  his  children,  the  character  and 
prices  of  his  food,  clothing  and  house,  his  own  actions,  speech 
and  opinions,  and  in  some  cases  even  his  religion,  are  con- 
trolled and  determined,  in  so  far  as  the  interests  of  the  em- 
ployer make  it  desirable  for  him  to  exercise  such  control. 
Such  conditions  are  established  and  maintained  not  only 
through  the  dictation  of  all  working  conditions  by  the  em- 

1 


ployer,  but  by  his  usurpation  or  control  of  the  functions  and 
machinery  of  political  government  in  such  communities. 

In  the  available  time  it  has  been  impossible  to  ascertain 
how  general  such  conditions  are,  but  it  is  clearly  indicated 
by  the  investigations  that  in  isolated  industrial,  mining,  or 
agricultural  communities,  which  are  owned  or  controlled  by 
single  individuals  or  corporations,  and  in  which  the  employees 
are  unorganized,  industrial  feudalism  is  the  rule  rather  than 
the  exception. 

In  such  communities  democratic  government  does  not,  as 
a  rule,  exist,  except  in  name  or  form,  and  as  a  consequence 
there  now  exist  within  the  body  of  our  Republic  industrial 
communities  which  are  virtually  principalities,  oppressive  to 
those  dependent  upon  them  for  a  livelihood  and  a  dreadful 
menace  to  the  peace  and  welfare  of  the  Nation. 

Such  conditions  as  these  are  the  direct  and  inevitable  con- 
sequence of  the  industrial  relations  which  exist  in  such  com- 
munities. Political  freedom  can  exist  only  where  there  is 
industrial  freedom;  political  democracy  only  where  there  is 
industrial  democracy. 

Such  industrial  democracy  has  been  established  in  a  greater 
or  less  degree  in  certain  American  industries  or  for  certain 
classes  of  employees.  But  between  conditions  of  industrial 
democracy  and  industrial  feudalism  there  are  almost  infinite 
gradations  marking  the  stages  of  evolution  which  have  been 
reached.  In  every  case,  however,  investigation  has  shown 
that  the  degree  of  political  freedom  and  democracy  which 
exists  is  conditioned  by  the  industrial  status  of  the  citizens 
who  form  the  majority  of  the  community. 

The  problems  of  industrial  relations,  therefore,  demand 
the  attention  of  Congress  not  only  because  they  determine 
the  life,  security  and  happiness  of  the  twenty-five  million  citi- 
zens of  the  United  States  who  occupy  the  position  of  wage 
earners,  but  because  they  affect  for  good  or  evil  the  Gov- 
ernment of  localities  and  States,  and  to  a  smaller  degree  that 
of  the  Nation  itself.  What  each  of  these  wage  earners  shall 
eat,  what  he  shall  wear,  where  he  shall  live,  and  how  long 


and  under  what  conditions  he  shall  labor,  are  determined  by 
his  industrial  status  and  by  his  relation  individually  or  col- 
lectively to  the  person  or  corporation  employing  him.  Sim- 
ilarly and  almost  as  directly  this  relationship  determines 
whether  the  machinery  of  government  shall  be  used  for  or 
against  his  welfare,  whether  his  vote  shall  count  for  or  against 
his  own  interest,  whether  he  shall  be  tried  by  a  jury  of  his 
peers  or  a  jury  selected  in  collusion  with  the  employing  com- 
pany, or,  under  conditions  of  so-called  martial  law,  by  no  jury 
whatever;  whether  in  fact  he  shall  be  a  free  man  or  be  de- 
prived of  every  right  guaranteed  by  Federal  and  State  con- 
stitutions, imprisoned  without  warrant  for  the  commission 
of  crimes  of  which  he  may  be  innocent,  or  forcibly  deported 
from  the  community  or  State  in  which  he  has  made  his  home. 
For  these  reasons  it  seems  desirable  at  the  outset  to  suggest 
a  recommendation  to  Congress  that  these  problems  of  indus- 
trial relationship  should  occupy  their  due  prominence  in  the 
deliberations  of  that  Honorable  Body,  and  that  the  entire 
machinery  of  the  Federal  Government  should  be  utilized  to  the 
greatest  possible  degree  for  the  correction  of  such  deplor- 
able conditions  as  have  been  found  to  exist. 

The  lack  of  a  proper  industrial  relationship  and  the  exist- 
ence of  bad  labor  conditions  is  a  matter  of  the  most  serious 
moment  during  times  of  peace,  but  the  events  of  the  past  year 
have  demonstrated  how  enormously  their  menace  to  the  wel- 
fare of  a  nation  is  increased  during  a  period  of  war.  The 
present  European  war  is  being  fought  on  the  farms  and  in 
the  factories  as  much  as  in  the  trenches.  The  effective  mobili- 
zation of  our  industrial  resources  is  as  important,  simply 
from  the  standpoint  of  war,  as  is  the  mobilization  of  our  mili- 
tary and  naval  forces. 

It  is  equally  important  that  action  should  be  taken  now, 
and  not  after  war  is  a  reality. 

An  attempt  has  been  made  in  the  succeeding  pages  of  this 
report  to  suggest  some  of  the  measures  which  should  be 
adopted,  with  a  full  realization,  however,  that  no  action  will 
be  effective  which  does  not  come  through  an  understanding 


by  the  American  people  of  the  essential  facts  regarding  in- 
dustrial conditions.  Practically,  there  are  only  two  alterna- 
tives for  effective  action:  First,  the  creation  of  a  huge  sys- 
tem of  bureaucratic  paternalism  such  as  has  been  developed 
in  Germany;  second,  action  which  removes  the  many  existing 
obstacles  which  prevent  effective  organization  and  co-opera- 
tion, reserving  for  performance  by  the  Government  only  those 
.services  which  can  not  be  effectively  conducted  by  voluntary 
organizations,  and  those  which  are  of  such  vital  importance 
to  the  entire  Nation  that  they  should  not  be  left  to  the  hazard 
of  private  enterprise. 

In  closing  this  introductory  statement,  it  is  proper  to  append 
a  quotation  from  Carlyle,  the  great  Scotch  historian,  which 
contains  in  a  few  eloquent  sentences  the  very  heart  of  the 
situation  in  American  industry : 

With  the  working  people,  again,  it  is  not  so  well.  Un- 
lucky !  For  there  are  from  twenty  to  twenty-five  millions 
of  them.  Whom,  however,  we  lump  together  into  a  kind 
of  dim  compendious  unity,  *  *  *,  as  "the  masses". 
Masses  indeed :  and  yet,  singular  to  say,  the  masses  con- 
sist all  of  units,  *  *  *,  every  unit  of  whom  has  his 
own  heart  and  sorrows ;  stands  covered  there  with  his  own 
skin,  and  if  you  prick  him  he  will  bleed.  Every  unit  of 
these  masses  is  a  miraculous  man,  even  as  thou  thyself 
art;  struggling  with  vision  or  with  blindness  for  his  in- 
finite kingdom  (this  life  which  he  has  got,  once  only,  in  the 
middle  of  eternities) ;  with  a  spark  of  the  divinity,  what 
thou  callest  an  immortal  soul,  in  him ! 

Clearly  a  difficult  "point"  for  government,  that  of  deal- 
ing with  these  masses;  if  indeed  it  be  not  rather  the 
sole  point  and  problem  of  government,  and  all  other  points 
mere  accidental  crotchets,  superficialities,  and  beatings  of 
the  wind !  For  let  charter-chests,  use  and  wont,  law  com- 
mon and  special,  say  what  they  will,  the  masses  count  to  so 
many  millions  of  units ;  made,  to  all  appearance,  by  God, 
whose  earth  this  is  declared  to  be. 


METHOD  AND  CHARACTER  OF  INVESTIGATION. 


In  the  investigation  of  questions  so  intimately  affecting 
the  lives  of  a  large  part  of  the  American  people,  the  ordinary 
methods  of  compiling  facts  and  drawing  deductions  would 
have  been  utterly  insufficient,  not  only  because  the  ground  to  be 
covered  was  too  extensive,  but  because  the  situation  was  too 
largely  the  result  of  the  opinions,  beliefs,  and  convictions  of 
employers  and  employees  to  be  susceptible  of  ascertainment  by 
such  a  method.  Furthermore,  it  became  clear  very  early  in  the 
investigation  that  the  problems  which  were  presented  could  be 
solved  only  by  the  will  and  conscience  of  the  American  people 
acting  either  directly  or  through  their  representatives  in  the 
State  and  Federal  Governments. 

The  Commission  has  therefore  called  before  it  witnesses 
representing  persons  drawn  from  almost  every  walk  of  life, 
whose  knowledge  and  opinions  were  believed  to  be  of  value. 
In  order  that  the  information  developed  by  these  hearings 
should  reach  the  people,  they  were  not  only  held  in  public, 
but,  through  the  newspapers,  the  facts  developed  by  them 
have  been  carried  throughout  the  Nation. 

These  hearings  have  occupied  in  all  154  days,  or  rather  more 
than  the  equivalent  of  six  months  of  the  Commission's  time. 
One  or  more  hearings  were  held  in  each  of  the  following 
cities :  Washington,  New  York,  Paterson,  Philadelphia,  Bos- 
ton, Chicago,  Lead  (S.  D.),  Butte,  Seattle,  Portland,  San 
Francisco,  Los  Angeles,  Denver  and  Dallas.  The  witnesses, 
however,  were  by  no  means  limited  to  these  localities,  but  in 
every  case  the  best  informed  persons  were  brought  to  the 
centers  at  which  the  hearings  were  held. 

The  representative  character  of  the  witnesses  may  best  be 
shown  by  the  statement  on  the  following  page. 


Classification  of  Witnesses  Upon  Industrial,  Subjects. 

Affiliated  with  employers : 

Employers,  managers,  foremen,  etc 134 

Representatives  of  employers '  organizations ...  37 

Attorneys 15 

Efficiency  engineers 10 

Employment  agents 14 

Capitalists,  bankers,  directors,  etc 20 

230 

Affiliated  with  labor : 

Trade  union  officials 135 

Workingmen  and  working  women 90 

Attorneys 6 

Industrial  Workers  of  the  World 8 

Representatives  of  the  Socialist  Party 6 

245 

Not  affiliated  with  either  group: 

Agriculturists 22 

Attorneys    15 

Public  officials  69 

Representatives  of  civic  organizations 24 

Educators  22 

Economists  and  sociologists   20 

Investigators 11 

Representatives  of  the  press 14 

Clergy   10 

Physicians    7 

Unclassified    17 

On  Chinese  exclusion 34 

265 

Total 740 


These  witnesses  were  not  arbitrarily  selected  by  the  Com- 
mission, but  were  chosen  only  after  careful  investigation  by 
agents  of  the  Commission,  who  consulted  the  persons  best  in- 
formed regarding  the  industry,  locality,  or  question  under 
consideration.  Every  opportunity  was  given  employers  and 
employees  to  suggest  the  names  of  witnesses  who  could  best 
present  their  side  of  the  case,  and  the  persons  thus  suggested 
were  without  exception  heard  with  absolute  freedom  not  only 
as  regards  time,  but  without  regard  to  the  technical  rules  of 
evidence. 

It  seems  desirable  also  to  call  attention  to  the  fact  that  in 
this  report,  except  for  citations  from  admittedly  non-partisan 
official  bodies,  there  are  no  statements  of  fact  affecting  any 
person  or  group  of  persons,  which  have  not  been  submitted  to 
the  parties  directly  concerned,  or  which  have  not  been  quoted 
from  documents  submitted  by  them  or  from  their  public  testi- 
mony. The  submission  of  the  facts  developed  by  preliminary 
investigation  to  the  parties  affected  for  verification  or  correc- 
tion at  public  hearings  is  believed  to  be  the  best  means  of  as- 
certaining the  truth  and  avoiding  evasion.  The  same  is  true 
of  the  recommendations  and  conclusions  contained  in  the  re- 
port, a  very  large  number  of  which  were  submitted  for  criti- 
cism at  public  hearings  or  by  correspondence. 


SUMMARY  OF   CONCLUSIONS  AND 
RECOMMENDATIONS 


In  the  act  of  Congress  creating  the  Commission,  section 
four  named  eleven  questions  into  which  inquiry  was  specific- 
ally directed.  Of  these  questions,  three,  relating  to  industrial 
conditions,  industrial  relations,  and  the  causes  of  industrial 
unrest,  were  fundamental  in  character  and  of  broad  scope, 
while  eight  were  specific  and  dealt  more  largely  with  matters 
of  detail.  Leaving  these  eight  specific  questions  for  detailed 
consideration  in  the  body  of  the  report,  it  seems  desirable  to 
present  briefly  at  this  point  the  findings  and  conclusions  with 
regard  to  these  general  questions. 


LABOR   CONDITIONS   IN   THE   PRINCIPAL   INDUS- 
TRIES, INCLUDING  AGRICULTURE. 

In  considering  the  conditions  of  labor  in  American  indus- 
tries, it  has  seemed  that  they  could  be  judged  or  appraised  only 
by  comparing  conditions  as  they  actually  exist  with  what 
knowledge  and  experience  shows  that  they  might  easily  be 
made  during  the  immediate  future  if  proper  action  were  taken 
to  utilize  the  resources  of  our  Nation  efficiently  and  dis- 
tribute the  products  equitably. 

As  against  this  view  there  has  been  an  attempt  by  some 
persons  to  urge  the  judgment  of  all  things  by  comparison 
with  the  past.  Much  stress  has  been  laid  by  certain  witnesses 
upon  the  alleged  improvement  of  the  condition  of  the  workers 
during  the  past  quarter  century. 

This  point,  however,  is  regarded  as  generally  immaterial. 
The  crux  of  the  question  rather  is,  Have  the  workers  received 
a  fair  share  of  the  enormous  increase  in  wealth  which  has 
taken  place  in  this  country,  during  the  period,  as  a  result 
largely  of  their  labors?    The  answer  is  emphatically — No! 


The  wealth  of  the  country  between  1890  and  1912  increased 
from  65  to  187  billions,  or  188  per  cent,  whereas  the  aggregate 
income  of  wage  earners  in  manufacturing,  mining,  and  trans- 
portation has  risen  between  1889  and  1909  only  95  per  cent, 
from  2516  millions  in  1889  to  4916  millions  in  1909.  Further- 
more, the  wage  earners '  share  of  the  net  product  '  of  industry 
in  the  case  of  manufactures  was  only  40.2  per  cent  in  1909, 
as  compared  with  44.9  per  cent  in  1889. 

Similarly,  the  attempt  to  dismiss  deplorable  labor  conditions 
in  the  United  States  by  arguments  that  they  are  better  than 
in  European  countries  is  repugnant.  To  say  that  conditions 
are  better  than  in  Great  Britain,  for  example,  is  simply  to  say 
that  somewhat  less  than  one-third  of  the  population  is  in  a 
state  of  absolute  poverty,  for  that  was  the  condition  reported 
by  the  latest  British  Commission.  It  should  be  a  matter  of 
shame  also  to  boast  that  the  condition  of  American  laborers 
is  better  than  that  of  laborers  in  the  " black  bread  belt"  of 
Germany. 

That  conditions  are,  as  a  matter  of  fact,  but  little  better 
is  proved  conclusively  by  the  almost  complete  cessation  of 
immigration  from  Germany,  England,  and  France.  No  bet- 
ter proof  of  the  miserable  condition  of  the  mass  of  American 
workers  need  be  sought  than  the  fact  that  in  recent  years 
laborers  in  large  numbers  have  come  to  this  country  only  from 
Bussia,  Italy,  Austria-Hungary  and  the  backward  and  impov- 
erished nations  of  southern  and  eastern  Europe. 

With  the  inexhaustible  natural  resources  of  the  United 
States,  her  tremendous  mechanical  achievements, .  and  the 
genius  of  her  people  for  organization  and  industry,  there  can 
be  no  natural  reason  to  prevent  every  able-bodied  man  of 
our  present  population  from  being  well  fed,  well  housed,  com- 
fortably clothed,  and  from  rearing  a  family  of  moderate  size 
in  comfort,  health  and  security.  How  far  this  ideal  is  actually 
achieved  is  discussed  in  some  detail  in  the  following  pages. 

It  is  evident  both  from  the  investigations  of  this  Commis- 


-The  net  product  is  the  value  that  remains  after  subtracting  the  cost  of 
materials  from  the  total  value. 


10 

sion  and  from  the  reports  of  all  recent  Governmental  bodies 
that  a  large  part  of  our  industrial  population  are,  as  a  result 
of  the  combination  of  low  wages  and  unemployment,  living  in  a 
condition  of  actual  poverty.  How  large  this  proportion  is 
can  not  be  exactly  determined,  but  it  is  certain  that  at  least 
one-third  and  possibly  one-half  of  the  families  of  wage  earners 
employed  in  manufacturing  and  mining  earn  in  the  course  of 
the  year  less  than  enough  to  support  them  in  anything  like 
a  comfortable  and  decent  condition.  The  detailed  evidence 
is  presented  in  a  separate  report  which  is  submitted  for 
transmittal  to  Congress.1  At  this  point  it  is  sufficient  to  call 
attention  to  the  results  of  the  most  exhausive  and  sweeping 
official  investigation  of  recent  years,  that  of  the  Immigration 
Commission,  which  reported  to  Congress  in  1909.  This  inves- 
tigation secured  detailed  information  regarding  the  daily  or 
weekly  earnings  of  619,595  employees  of  all  classes  in  our  basic 
maaufacturing  industries  and  in  coal  mining,  and  information 
regarding  income  and  living  conditions  for  15,726  families. 

It  was  found  that  the  incomes  of  almost  two-thirds  of  these 
families  (64  per  cent)  were  less  than  $750  per  year  and  of 
almost  one-third  (31  per  cent)  were  less  than  $500,  the  average 
for  all  being  $721.  The  average  size  of  these  families  was 
5.6  members.  Elaborate  studies  of  the  cost  of  living  made  in 
all  parts  of  the  country  at  the  same  time  have  shown  that 
the  very  least  that  a  family  of  five  persons  can  live  upon  in 
anything  approaching  decency  is  $700.  It  is  probable  that, 
owing  to  the  fact  that  the  families  investigated  by  the  Im- 
migration Commission  were,  to  a  large  extent,  foreign  born, 
the  incomes  reported  are  lower  than  the  average  for  the 
entire  working  population;  nevertheless,  even  when  every 
allowance  is  made  for  that  fact,  the  figures  show  conclusively 
that  between  one-half  and  two-thirds  of  these  families  were 
living  below  the  standards  of  decent  subsistence,  while  about 
one-third  were  living  in  a  state  which  can  be  described  only  as 
abject  poverty. 

1 — Report   of   Edgar    Sydenstricker:      Labor    Conditions    in    American    In- 
dustries. 


11 

American  society  was  founded  and  for  a  long  period  existed 
upon  the  theory  that  the  family  should  derive  its  support  from 
the  earnings  of  the  father.  How  far  we  have  departed  from 
this  condition  is  shown  by  the  fact  that  79  per  cent  of  the 
fathers  of  these  families  earned  less  than  $700  per  year.  In 
brief,  only  one-fourth  of  these  fathers  could  have  supported 
their  families  on  the  barest  subsistence  level  without  the  earn- 
ings of  other  members  of  the  family  or  income  from  outside 
sources. 

Other  facts  collected  in  this  investigation  show  conclusively 
that  a  very  large  proportion  of  these  families  did  not  live  in 
decency  and  comfort.  Thirty  per  cent  kept  boarders  and  lodg- 
ers, a  condition  repugnant  to  every  ideal  of  American  family 
life,  especially  in  the  crowded  tenements  or  tiny  cottages  in 
which  the  wage  earners  of  America  characteristically  live. 
Furthermore,  in  77  per  cent  of  the  families  two  or  more  per- 
sons occupied  each  sleeping  room,  in  37  per  cent  three  or 
more  persons,  and  in  15  per  cent  four  or  more  persons. 

The  most  striking  evidence  of  poverty  is  the  proportion  of 
pauper  burials.  The  repugnance  of  all  classes  of  wage  earn- 
ers of  all  races  to  pauper  burial  is  such  that  everything  will 
be  sacrificed  and  heavy  debts  incurred  rather  than  permit 
any  member  of  the  family  to  lie  in  the  "potters'  field";  nev- 
ertheless in  New  York  City  one  out  of  every  twelve  corpses 
is  buried  at  the  expense  of  the  city  or  turned  over  to  phy- 
sicians for  dissection.1 

The  terrible  effects  of  such  poverty  may  be  outlined  in  a 
few  paragraphs,  but  their  far-reaching  consequences  could 
not  be  adequately  shown  in  a  volume. 

Children  are  the  basis  of  the  State;  as  they  live  or  die,  as 
they  thrive  or  are  ill-nourished,  as  they  are  intelligent  or  ig- 
norant, so  fares  the  State.  How  do  the  children  of  American 
workers  fare? 


1 — Statistics  for  New  York  are  the  only  ones  available  which  are  reasonably 
complete.  Even  there  not  all  are  included  who  die  in  a  state  of  extreme 
poverty,  as  it  is  well  known  that  national  societies  and  sympathetic  in- 
dividuals claim  a  large  number  of  bodies  of  persons  absolutely  unknown 
to  them. 


12 

It  has  been  proved  by  studies  here  and  abroad  that  there  is 
a  direct  relation  between  poverty  and  the  death  rate  of 
babies;  but  the  frightful  rate  at  which  poverty  kills  was  not 
known,  at  least  for  this  country,  until  very  recently,  when 
through  a  study  made  in  Johnstown,  Pa.,  by  the  Federal  Chil- 
dren's  Bureau,  it  was  shown  that  the  babies  whose  fathers 
earned  less  than  $10  per  week  died  during  the  first  year  at 
the  appalling  rate  of  256  per  1000.  On  the  other  hand,  those 
whose  fathers  earned  $25  per  week  or  more  died  at  the  rate 
of  only  84  per  1000.  The  babies  of  the  poor  died  at  three  times 
the  rate  of  those  who  were  in  fairly  well-to-do  families.  The 
tremendous  significance  of  these  figures  will  be  appreciated 
when  it  is  known  that  one-third  of  all  the  adult  workmen 
reported  by  the  Immigration  Commission  earned  less  than 
$10  per  week,  even  exclusive  of  time  lost.  On  the  showing  of 
Johnstown  these  workmen  may  expect  one  out  of  four  of 
their  babies  to  die  during  the  first  year  of  life. 

The  last  of  the  family  to  go  hungry  are  the  children,  yet 
statistics  show  that  in  six  of  our  largest  cities  from  12  to  20 
per  cent  of  the  children  are  noticeably  underfed  and  ill- 
nourished. 

The  minimum  amount  of  education  which  any  child  should 
receive  is  certainly  the  grammar  school  course,  yet  statistics 
show  that  only  one-third  of  the  children  in  our  public  schools 
complete  the  grammar  school  course,  and  less  than  10  per  cent 
finish  high  school.1  Those  who  leave  are  almost  entirely  the 
children  of  the  workers,  who,  as  soon  as  they  reach  working 
age,  are  thrown,  immature,  ill-trained,  and  with  no  practical 
knowledge,  into  the  complexities  of  industrial  life.  In  each 
of  four  industrial  towns  studied  by  the  Bureau  of  Labor 
Statistics,  more  than  75  per  cent  of  the  children  quit  school 
before  reaching  the  seventh  grade.2 


1 — Elimination   of  pupils   from   school.      Edward   L.    Thorndike. — Bull.    379, 

U.  S.  Bureau  of  Education. 
2 — Conditions  under  which  children  leave  school  to  go  to  work.     Vol.  VII 

of  Report  on   Conditions   of   Woman   and   Child    Wage  Earners   in   the 

United  States.     S.  Doc.  No.  645,  61st  Cong.,  2d  Sess. 


13 

The  great  seriousness  of  this  condition  is  even  more  acutely 
realized  when  it  is  known  that  in  the  families  of  the  workers 
37  per  cent  of  the  mothers  are  at  work1  and  consequently 
unable  to  give  the  children  more  than  scant  attention.  Of 
these  mothers  30  per  cent  keep  boarders  and  lodgers  and  7 
per  cent  work  outside  the  home. 

As  a  final  statement  of  the  far-reaching  effects  of  the  eco- 
nomic condition  of  American  wage  earners,  it  seems  proper 
to  quote  the  following  statement  of  the  Chicago  Commission 
on  Crime,  which  after  thorough  investigation  has  reported 
during  the  past  year: 

The  pressure  of  economic  conditions  has  an  enormous 
influence  in  producing  certain  types  of  crime.  Unsani- 
tary housing  and  working  conditions,  unemployment, 
wages  inadequate  to  maintain  a  human  standard  of  living, 
inevitably  produce  the  crushed  or  distorted  bodies  and 
minds  from  which  the  army  of  crime  is  recruited.  The 
crime  problem  is  not  merely  a  question  of  police  and 
courts,  it  leads  to  the  broader  problems  of  public  sani- 
tation, education,  home  care,  a  living  wage,  and  industrial 
democracy.2 

The  other  factors  in  the  conditions  under  which  labor  is  em- 
ployed in  American  industry,  such  as  working  hours,  regular- 
ity of  employment,  safety  and  sanitation,  are  left  for  later  dis- 
cussion. Suffice  it  to  say  in  this  connection  that  while  in  cer- 
tain fields  great  improvements  have  been  made,  the  general 
situation  is  such  that  they  accentuate  rather  than  relieve  the 
deplorable  effects  of  inadequate  income  which  have  been  point- 
ed out. 

As  a  picture  of  American  industry,  this  presentation  is  un- 
deniably gloomy  and  depressing,  but  as  a  diagnosis  of  what 


1 — Summary  report  on  immigrants  in  manufacturing  and  mining.  Vols.  19 
and  20  of  Reports  of  the  Immigration  Commission.  S.  Doc.  No.  633,  61st 
Cong.,  2d  Sess. 

2 — Report  of  the  City  Council  Committee  on  Crime,  Chicago,  Summary  of 
Findings,  Sec.  14,  p.  12. 


14 

is  wrong  with  American  labor  conditions,  it  is  true  and  exact. 
There  are  of  course  many  bright  spots  in  American  industry, 
where  workmen  are  well  paid  and  regularly  employed  under 
good  working  conditions  in  the  determination  of  which  they 
have  some  share.  But,  even  as  the  physician  pays  little  atten- 
tion to  the  good  eyes  and  sound  teeth  of  a  patient  whose  vital 
organs  are  diseased,  so  impressive  is  the  urgent  need  for  at- 
tention to  the  diseased  spots  in  industry,  it  is  felt  to  be  unnec- 
essary to  waste  time  in  word  pictures  of  conditions  which  are 
all  right  or  which  may  be  depended  upon  to  right  themselves. 

In  agriculture  there  is  no  array  of  exact  figures  which  can 
be  quoted  to  show  the  condition  of  labor.  But,  speaking  gen 
erally,  the  available  evidence  indicates  clearly  that  while  in 
some  sections  agricultural  laborers  are  well  paid  and  fairly 
treated,  the  condition  of  the  mass  is  very  much  like  that  of 
the  industrial  workers. 

Moreover,  there  is  a  peculiar  condition  in  agriculture,  which 
merits  a  brief  but  strong  statement  at  this  point  as  a  preface 
to  a  more  detailed  discussion  later.  The  most  alarming  fact 
in  American  agriculture  is  the  rapid  growth  of  tenancy.  In 
1910  there  were  37  tenant-operated  farms  in  each  100  farms 
in  the  United  States,  as  compared  with  28  in  1890,  an  increase 
of  32  per  cent  during  20  years.  No  nation-wide  investigation 
of  the  condition  of  tenant  farmers  has  ever  been  made,  but 
in  Texas,  where  the  investigations  of  this  Commission  were 
thorough  and  conclusive,  it  was  found  not  only  that  the  eco- 
nomic condition  of  the  tenant  was  extremely  bad,  but  that  he 
was  far  from  being  free,  while  his  future  was  regarded  as 
hopeless.  Badly  housed,  ill-nourished,  uneducated  and  hope- 
less, these  tenants  continue  year  after  year  to  eke  out  a  bare 
living,  moving  frequently  from  one  farm  to  another  in  the 
hope  that  something  will  turn  up.  "Without  a  large  family 
the  tenant  cannot  hope  to  succeed  or  break  even,  so  in  each  ten- 
ant family  numerous  children  are  being  reared  to  a  future 
which  under  present  conditions  will  be  no  better  than  that  of 
their  parents,  if  as  good.  The  wife  of  a  typical  tenant  farmer, 
the  mother  of  eleven  children,  stated  in  her  testimony  before 


15 

the  Commission  that  in  addition  to  the  rearing  of  children, 
making  their  clothes  and  doing  the  work  of  the  house,  she  al- 
ways helped  with  the  crops,  working  np  to  within  three  or 
four  months  before  children  were  born,  and  that  during  all 
the  years  of  her  married  life  she  had  had  no  ready-made 
dresses  and  only  three  hats.  The  investigations  of  this  Com- 
mission in  that  rich  and  generally  prosperous  section  of  the 
country  only  confirm  and  accentuate  the  statements  of  the 
Federal  Industrial  Commission  which  reported  in  1902 : 

The  result  of  this  system  [share  tenancy]  is  that  the 
renters  rarely  ever  succeed  in  laying  by  a  surplus.  On 
the  contrary,  their  experiences  are  so  discouraging  that 
they  seldom  remain  on  the  same  farm  for  more  than  a 
year.  They  are  not  only  unable  to  lay  by  any  money, 
but  their  children  remain  uneducated  and  half  clothed. 
The  system  is  apparently  one  of  the  most  undesirable,  so 
far  as  its  effect  on  the  community  is  concerned.1 

Similarly,  the  Public  Lands  Commission  reported  in  1905 : 

There  exists  and  is  spreading  in  the  "West  a  tenant 
or  hired  labor  system  which  not  only  represents  a  rela- 
tively low  industrial  development,  but  whose  further  de- 
velopment carries  with  it  a  most  serious  threat.  Polit- 
ically, socially  and  economically  this  system  is  indefensi- 
ble. 

The  condition  of  agricultural  laborers  can  not,  however, 
be  dismissed  without  referring  to  the  development  of  huge 
estates  which  are  operated  by  managers  with  hired  labor  on 
what  may  properly  be  called  a  ' '  factory  system. ' '  The  condi- 
tions upon  such  estates  are  deplorable  not  only  because  of  the 
extremely  low  wages  paid  (80  cents  per  day  in  the  case  of 
one  which  was  carefully  investigated),  but  even  more  because 
these  estates,  embracing  within  their  boundaries  entire  coun- 
ties and  towns,  are  a  law  unto  themselves  and  the  absolute 
dictators  of  the  lives,  liberties  and  happiness  of  their  em- 

1— Reports  of  the  Industrial  Commission,  Vol.  XIX,  1902,  p.  98. 


16 

ployees.  It  is  industrial  feudalism  in  an  extreme  form.  Such 
estates  are,  as  a  rule,  the  property  of  absentee  landlords,  who 
are  for  the  most  part  millionaires,  resident  in  the  eastern 
States  or  in  Europe. 


EXISTING  RELATIONS  BETWEEN  EMPLOYERS 
AND  EMPLOYEES. 

Considering  the  whole  field  of  American  industry,  there 
are  almost  infinite  variations  of  relationship  between  employ- 
ers and  employees,  ranging  from  the  individual  worker,  hired 
by  a  single  employer,  as  in  domestic  service  and  agriculture, 
to  the  huge  corporation  with  a  hundred  thousand  stockhold- 
ers and  a  quarter  of  a  million  employees.  Relationship  varies 
from  that  of  direct  contact  to  a  situation  where  the  employee, 
together  with  thousands  of  his  fellow-workers,  is  separated 
by  hundreds  of  miles  from  the  individuals  who  finally  control 
his  employment  and  of  whose  existence  he  is  usually  entirely 
ignorant. 

A  thorough  discission  of  the  relationships  which  exist 
under  these  various  forms  of  industrial  organization  would 
be  not  only  tedious  but  useless  for  all  practical  purposes.  The 
typical  form  of  industrial  organization  is  the  corporation: 
In  transportation  approximately  100  per  cent  of  the  wage 
earners  are  employed  by  corporations ;  in  mining,  90  per  cent, 
and  in  manufacturing,  75  per  cent.  Moreover,  it  is  under 
this  form  that  the  great  problems  of  industrial  relations  have 
developed. 

The  actual  relationship  which  exists  between  employers  and 
employees  under  the  artificial  conditions  which  characterize 
the  corporate  form  of  organization  can  not  be  understood 
without  an  analysis  of  the  powers,  functions  and  responsi- 
bilities of  the  different  elements  which  go  to  make  up  the 
typical  corporation.    The  actual  ownership  of  a  corporation 


17 

is  vested  in  the  stockholders  and  bondholders,  whose  only 
interest  in  the  industry  is  represented  by  certificates  upon  the 
basis  of  which  they  expect  the  payment  of  interest  or  divi- 
dends at  stated  intervals. 

The  control  of  the  property,  as  far  as  operation  is  con- 
cerned, rests  finally  with  the  stockholders,  or  with  some  par- 
ticular class  of  stockholders  whose  shares  entitle  them  to 
vote.  The  stockholders,  however,  act  through  the  Board  of 
Directors,  who  are  usually  elected  in  such  a  way  that  they 
represent  only  the  dominant  interest.1  As  far  as  the  organi- 
zation of  the  corporation  is  concerned,  the  principal  function 
of  the  Board  of  Directors  is  to  select  the  executive  officials. 
These  executive  officials,  either  directly  or  indirectly,  select 
the  numerous  superintendents,  foremen  and  petty  bosses  by 
whom  the  direct  operation  of  the  enterprise  is  managed  and 
through  whom  all  the  workers  are  hired,  discharged  and  dis- 
ciplined. 

This  is  a  skeleton  of  corporate  organization.  To  under- 
stand its  operations  it  is  necessary  to  examine  the  functions 
and  responsibilities  of  the  different  parts  of  the  organization. 

Theoretically  and  legally,  the  final  control  and  responsi- 
bility rests  with  the  stockholders,  but  in  actual  practice  a  very 
different  situation  is  found.  The  relationship  of  stockholders 
to  a  corporation  is  anything  but  permanent;  in  a  busy  week 
on  Wall  street,  the  number  of  shares  bought  and  sold  in  one 
of  the  great  corporations  will  greatly  exceed  the  total  number 
of  shares  that  are  in  existence.  The  stockholders  as  a  class, 
therefore,  have  no  guiding  interest  in  the  permanent  efficiency 
of  the  corporation  as  regards  either  the  preservation  of  its 
physical  property  or  the  maintenance  of  an  efficient  productive 
organization.  Stocks  are  bought  either  as  a  speculation  or  as 
an  investment,  and  in  case  either  the  physical  property  deteri- 
orates or  the  productive  organization  tends  to  become  ineffi- 
cient, the  well-informed  stockholder  generally  takes  no  steps 
to  correct  the  condition,  but  merely  throws  his  stock  upon 

1 — See  the  testimony  of  Mr.  Jacob  H.  Schiff,  Mr.  Samuel  Untermyer  and 
others  upon  this  point 


18 

the  market.  This  marks  a  very  real  and  definite  distinction 
from  the  actual  ownership  of  a  property  or  business  which 
must  be  kept  in  good  condition  by  its  owner  as  regards  both 
plant  and  organization.  If  all  industries  were  owned  and 
operated  by  individuals,  there  might  be  some  reason  to  hope 
that  generally  satisfactory  wages  and  physical  conditions 
might  be  attained  through  the  education  of  the  owner  to  a 
realization  that  permanent  success  depended  absolutely  upon 
the  maintenance  of  the  plant  in  the  best  condition  and  the  per- 
manent satisfaction  of  the  legitimate  demands  of  the  work- 
ers, but  with  the  impersonal,  remote  and  irresponsible  status 
of  control  by  stock  ownership,  such  a  hope  must  be  purely  illu- 
sory. The  ordinary  stockholder  in  a  large  corporation  ac- 
tually occupies  a  less  direct  relationship  to  the  corporation  in 
which  he  is  interested,  has  less  knowledge  of  its  actual  oper- 
ations, and  less  control  over  its  management,  than  the  ordi- 
nary citizen  has  over  local,  state  and  national  governments. 

Boards  of  Directors  in  theory  are  responsible  for  and  would 
naturally  be  expected  to  maintain  supervision  over  every 
phase  of  the  corporation's  management,  but,  as  a  matter  of 
fact,  we  know  that  such  supervision  is  maintained  only  over 
the  financial  phase  of  the  business,  controlling  the  acquisition 
of  money  to  operate  the  business  and  distributing  the  profits. 
Actual  direction  generally  exists  only  through  the  removal 
of  executive  officials  who  fail  to  deliver  the  expected  profits, 
and  through  the  appointment  of  their  successors.1 

Upon  the  testimony  of  financiers  representing,  as  directors, 
hundreds  of  corporations,  the  typical  director  of  large  cor- 
porations is  not  only  totally  ignorant  of  the  actual  operations 
of  such  corporations,  whose  properties  he  seldom,  if  ever, 
visits,  but  feels  and  exercises  no  responsibility  for  anything 
beyond  the  financial  condition  and  the  selection  of  executive 
officials.  Upon  their  own  statements,  these  directors  know 
nothing  and  care  nothing  about  the  quality  of  the  product,  the 
condition  and  treatment  of  the  workers  from  whose  labor 


1 — See  especially  the  testimony  of  Messrs.  J.  P.  Morgan,  John  D.  Rockefeller, 
Jr.,  and  August  Belmont  upon  this  point. 


19 

they  derive  their  income,  nor  the  general  management  of  the 
business.1 

As  far  as  operation  and  actual  management  are  concerned, 
the  executive  officials  are  practically  supreme.  Upon  their 
orders  production  is  increased  or  decreased,  plants  are  oper- 
ated or  shut  down  and  upon  their  recommendations  wages 
are  raised  or  lowered.  But  even  they  have  little  direct  con- 
tact with  the  actual  establishment  of  working  conditions,  and 
no  relation  at  all  with  the  rank  and  file  of  the  workers.  They 
act  upon  the  recommendations  of  superintendents,  whose  in- 
formation comes  from  their  assistants  and  foremen  and  from 
the  elaborate  statistics  of  modern  business,  which  account 
for  every  piece  of  material  and  product,  show  the  disposition 
of  every  penny  that  comes  and  goes,  but  ignore,  as  though  they 
did  not  exist,  the  men  and  women  whose  labor  drives  the 
whole  mechanism  of  business. 

Here,  then,  is  the  field  of  industrial  relations:  Masses  of 
workers  on  the  one  side  dealing  in  some  manner  with  foremen 
and  superintendents  on  the  other,  behind  whom  is  an  organi- 
zation of  executive  officials,  representing  in  turn  the  Board 
of  Directors,  who  are  the  chosen  representatives  of  the  stock- 
holders. 

The  crux  of  the  whole  question  of  industrial  relations  is: 
Shall  the  workers  for  the  protection  of  their  interests  be  or- 
ganized and  represented  collectively  by  their  chosen  dele- 
gates, even  as  the  stockholders  are  represented  by  their  Di- 
rectors and  by  the  various  grades  of  executive  officials  and 
bosses? 

In  considering  this  issue  the  first  question  that  presents 
itself  is:  Why  should  such  representation  be  demanded  as  a 
necessity?  Not  only  are  the  executive  officials,  superintend- 
ents and  bosses,  some  witnesses  have  urged  before  the  Com- 
mission, for  the  most  part  humane  and  well-intentioned  men, 
but  they  know  that  the  interests  of  the  business  depend  upon 
the  welfare  of  the  workers  and,  if  unhindered,  will  pay  the 

1 — See  the  testimony  of  Messrs.  Jacob  H.  Schiff,  Daniel  Guggenheim,  Roger 
W.  Babson,  and  John  D.  Rockefeller,  Jr. 


20 

best  wages  and  create  the  best  working  conditions  that  the 
business  can  afford.  Organization  and  representation  are 
therefore  argued  to  be  unnecessary  and  tending  only  to  pro- 
mote friction  and  interfere  with  the  management  of  the  busi- 
ness. 

Let  us  grant  the  high  character  and  good  intentions  of  offi- 
cials, and  consider  the  statement  of  the  workers  in  reply. 

They  say  that  in  modern  corporate  business  the  actions  of 
officials  are  governed  not  by  their  personal  intentions,  but  by 
the  inexorable  demands  for  interest  and  dividends,  and  are 
driven  not  by  their  desire  to  create  a  permanently  successful 
business  with  a  contented  labor  force,  but  by  the  never-relaxed 
spur  of  the  comparative  cost-sheet.  The  constant  demand 
is  for  high  production  at  low  cost,  not  through  improvements 
and  good  conditions  which  might  give  them  next  year,  but  this 
very  month.  In  the  high  pressure  of  business,  every  super- 
intendent knows  that  if  his  plant  is  at  the  bottom  of  the  com- 
parative scale  for  two  months  his  position  topples,  and  if  for 
three  months  it  is  virtually  gone.  He  can  not  afford  to  experi- 
ment with  changes  that  will  not  give  immediate  results.  If  he 
were  his  own  master  he  might  take  a  chance,  knowing  that  the 
loss  of  this  year  would  be  compensated  by  gains  under  better 
conditions  next  year,  but  the  monthly  cost-sheet  does  not 
wait  for  next  year ;  it  demands  results  now. 

But  it  may  be  said  that,  if  he  can  not  improve  conditions 
himself,  he  can  at  least  recommend  them  to  his  superiors 
to  be  transmitted  to  the  Board  of  Directors  for  approval.  This 
might  indeed  be  done,  and  with  the  extension  of  an  understand- 
ing among  managers  that  low  production  costs  may  be  secured 
with  high  wages,  probably  would  be  to  an  increasing  extent, 
except  that  Boards  of  Directors  scorn  such  abstractions  as  the 
high-wage-low-cost  theory,  and  habitually  insist  that  mana- 
gers shall  buy  labor,  as  they  buy  material,  in  the  cheapest 
market.  Moreover,  raising  wages  is  traditionally  unpopular 
among  stockholders  and  directors,  and  recommendations  for 
better  conditions,  particularly  if  they  involve  new  capital, 


21 

are  frowned  upon.1  Neither  the  stockholders  nor  the  direc- 
tors have  to  live  on  wages  or  work  in  the  existing  surround- 
ings, and  profits  deferred  are  considered  profits  lost. 

The  workers,  therefore,  deny  the  potency  of  even  good  in- 
tentions on  the  part  of  managers,  and  point  to  labor  history 
which  they  allege  shows  that  at  best  only  isolated  cases  can  be 
pointed  out  where  marked  improvements  have  taken  place 
except  in  response  to  repeated  demands  from  the  workers  or 
to  forestall  the  growth  of  threatened  organization.  They  point 
also  to  such  facts  as  that  children  of  12  years  or  younger  were 
not  only  employed  in  the  factories  (as  they  still  are  in  some 
States  where  there  has  been  little  aggressive  agitation),  but 
almost  without  exception  were  insisted  upon  by  the  employers 
as  a  necessity. 

The  evidence  of  this  character,  which  is  summarized  else- 
where, seems  to  be  conclusive  of  the  necessity  for  organiza- 
tion and  representation  under  modern  business  conditions. 
But  even  if  it  were  not  necessary,  it  is  difficult  to  see  any  rea- 
son why  what  is  demanded  and  required  by  stockholders 
should  be  denied  to  workers.  It  would  be  as  illogical  for 
stockholders  individually  to  attempt  to  deal  with  the  repre- 
sentatives of  the  unions,  as  it  is  for  the  individual  worker  to 
attempt  to  deal  with  executive  officials,  representing  the  or- 
ganized stockholders. 


1 — See  the  discussion  in  the  1915  stockholders'  meeting  of  the  U.  S.  Steel 
Corporation  which  was  devoted  almost  exclusively  to  the  question 
whether  the  corporation,  at  an  expense  of  a  few  thousand  dollars,  should 
continue  to  send  a  copy  of  the  annual  report  to  each  stockholder  of 
record. 


22 


CAUSES  OF  INDUSTRIAL  UNREST. 

It  is  presumed  that  Congress  had  in  mind,  in  directing  the 
Commission  to  inquire  into  the  "causes  of  dissatisfaction  in 
the  industrial  situation,"  something  far  different  from  that 
"dissatisfaction  with  the  present  which  is  the  hope  of  the 
future,"  that  desire  for  better  things  which  drives  men  forever 
forward.  Such  dissatisfaction  is  the  mainspring  of  all  pro- 
gress, and  is  to  be  desired  in  every  nation,  in  all  walks  of  life. 

It  is  believed  that  Congress  intended  the  inquiry  to  be  di- 
rected to  that  unrest  and  dissatisfaction  which  grows  out  of 
the  existence  of  intolerable  industrial  conditions,  and  which, 
if  unrelieved,  will  in  the  natural  course  of  events  rise  into 
active  revolt  or,  if  forcibly  suppressed,  sink  into  sullen 
hatred. 

Of  the  existence  of  such  unrest  ample  evidence  has  been 
found.  It  is  the  basis  of  the  establishment  and  growth  of  the 
I.  W.  W.,  whose  card-carrying  members  number  only  a  few 
thousands  but  which,  as  "a  spirit  and  a  vocabulary,"  per- 
meates to  a  large  extent  enormous  masses  of  workers,  particu- 
larly among  the  unskilled  and  migratory  laborers.  But  en- 
tirely apart  from  those  who  accept  its  philosophy  and  creed, 
there  are  numberless  thousands  of  workers,  skilled  and  un- 
skilled, organized  and  unorganized,  who  feel  bitterly  that  they 
and  their  fellows  are  being  denied  justice,  economically,  polit- 
ically, and  legally.  Just  how  widespread  this  feeling  is,  or 
whether  there  is  imminent  danger  of  a  quickening  into  active, 
nation-wide  revolt,  none  can  say.  But  no  one  who  reads  the 
papers  from  which  the  workers  get  their  ideas  and  inspira- 
tion; no  one  who  has  studied  with  care  the  history  of  such 
strikes  as  those  at  Lawrence  and  Paterson,  in  West  Virginia 
and  Colorado,  and  has  understood  the  temper  of  the  strikers ; 
no  one  who  has  associated  with  large  numbers  of  workers  in 
any  part  of  the  country,  can  fail  to  be  impressed  by  the  gravity 
of  the  situation. 


23 

This  sense  of  tension  and  impending  danger  has  been  ex- 
pressed by  numerous  witnesses  before  the  Commission,  but 
by  none  more  forcibly  than  by  Mr.  Daniel  Guggenheim,  a 
capitalist  whose  interests  in  mines  and  industrial  plants  ex- 
tend to  every  part  of  the  country. 

Chairman  Walsh.  What  do  you  think  has  been  accom- 
plished by  the  philanthropic  activities  of  the  country  in 
reducing  suffering  and  want  among  the  people  ? 

Mr.  Guggenheim.  There  has  a  great  deal  been  done.  If 
it  were  not  for  what  has  been  done  and  what  is  being  done 
we  would  have  revolution  in  this  country. 

The  sources  from  which  this  unrest  springs  are,  when  stated 
in  full  detail,  almost  numberless.  But  upon  careful  analysis 
of  their  real  character  they  will  be  found  to  group  themselves 
almost  without  exception  under  four  main  sources  which  in- 
clude all  the  others.    These  four  are : 

1.  Unjust  distribution  of  wealth  and  income. 

2.  Unemployment  and  denial  of  an  opportunity  to  earn 

a  living. 

3.  Denial  of  justice  in  the  creation,  in  the  adjudication, 

and  in  the  administration  of  law. 

4.  Denial  of  the  right  and  opportunity  to  form  effective 

organizations. 


1.     Unjust  Distribution  of  Wealth  and  Income. 

The  conviction  that  the  wealth  of  the  country  and  the  in- 
come which  is  produced  through  the  toil  of  the  workers  is  dis- 
tributed without  regard  to  any  standard  of  justice,  is  as  wide- 
spread as  it  is  deep-seated.  It  is  found  among  all  classes  of 
workers  and  takes  every  form  from  the  dumb  resentment  of 
the  day  laborer,  who,  at  the  end  of  a  week's  back-breaking  toil, 


24 

finds  that  he  has  less  than  enough  to  feed  his  family  while 
others  who  have  done  nothing  live  in  ease,  to  the  elaborate 
philosophy  of  the  "soap-box  orator,"  who  can  quote  statistics 
unendingly  to  demonstrate  his  contentions.  At  bottom,  though, 
there  is  the  one  fundamental,  controlling  idea  that  income 
should  be  received  for  service  and  for  service  only,  whereas, 
in  fact,  it  bears  no  such  relation,  and  he  who  serves  least,  or 
not  at  all,  may  receive  most. 

This  idea  has  never  been  expressed  more  clearly  than  in  the 
testimony  of  Mr.  John  H.  Walker,  President  of  the  Illinois 
State  Federation  of  Labor : 

A  working  man  is  not  supposed  to  ask  anything  more 
than  a  fair  day's  wage  for  a  fair  day's  work;  he  is  sup- 
posed to  work  until  he  is  pretty  fairly  tuckered  out,  say 
eight  hours,  and  when  he  does  a  fair  day's  work  he  is  not 
supposed  to  ask  for  any  more  wages  than  enough  to  sup- 
port his  family,  while  with  the  business  man  the  amount 
of  labor  furnishes  no  criterion  for  the  amount  they  re- 
ceive. People  accept  it  as  all  right  if  they  do  not  do  any 
work  at  all,  and  accept  it  as  all  right  that  they  get  as  much 
money  as  they  can;  in  fact,  they  are  given  credit  for 
getting  the  greatest  amount  of  money  with  the  least 
amount  of  work ;  and  those  things  that  are  being  accepted 
by  the  other  side  as  the  things  that  govern  in  everyday 
life,  and  as  being  right,  have  brought  about  this  condition, 
this  being  in  my  judgment  absolutely  unfair ;  that  is,  on 
the  merits  of  the  proposition  in  dealing  with  the  workers. 

The  workers  feel  this,  some  unconsciously  and  some  con- 
sciously, but  all  of  them  feel  it,  and  it  makes  for  unrest, 
in  my  judgment,  and  there  can  be  no  peace  while  that  con- 
dition obtains. 

In  the  highest  paid  occupations  among  wage  earners,  such 
as  railroad  engineers  and  conductors,  glass-blowers,  certain 
steel-mill  employees,  and  a  few  of  the  building  trades,  the  in- 
comes will  range  from  $1,500  to  $2,000  at  best,  ignoring  a  few 
exceptional  men  who  are  paid  for  personal  qualities.    Such  an 


25 

income  means,  under  present-day  conditions,  a  fair  living  for 
a  family  of  moderate  size,  education  of  the  children  through 
high  school,  a  small  insurance  policy,  a  bit  put  by  for  a  rainy 
day — and  nothing  more.  With  unusual  responsibilities  or  mis- 
fortunes, it  is  too  little,  and  the  pinch  of  necessity  is  keenly 
felt.  To  attain  such  wages,  moreover,  means  that  the  worker 
must  be  far  above  the  average,  either  in  skill,  physical 
strength,  or  reliability.  He  must  also  have  served  an  ap- 
prenticeship equal  in  length  to  a  professional  course.  Finally, 
and  most  important,  he  or  his  predecessors  in  the  trade  must 
have  waged  a  long,  aggressive  fight  for  better  wages,  for  there 
are  other  occupations  whose  demand  for  skill,  strength  and 
reliability  are  almost  as  great  as  those  mentioned,  where  the 
wages  are  very  much  less. 

These  occupations,  however,  include  but  a  handful  compared 
to  the  mass  of  the  workers.  "What  do  the  millions  get  for  their 
toil,  for  their  skill,  for  the  risk  of  life  and  limb?  That  is  the 
question  to  be  faced  in  an  industrial  nation,  for  these  millions 
are  the  backbone  and  sinew  of  the  State,  in  peace  or  in  war. 

First,  with  regard  to  the  adult  workmen,  the  fathers  and 
potential  fathers,  from  whose  earnings,  according  to  the 
"American  standard,"  the  support  of  the  family  is  supposed 
to  be  derived. 

Between  one-fourth  and  one-third  of  the  male  workers  18 
years  of  age  and  over,  in  factories  and  mines,  earn  less  than 
$10  per  week ;  from  two-thirds  to  three-fourths  earn  less  than 
$15,  and  only  about  one-tenth  earn  more  than  $20  a  week. 
This  does  not  take  into  consideration  lost  working  time  for 
any  cause. 

Next  are  the  women,  the  most  portentously  growing  factor 
in  the  labor  force,  whose  wages  are  important,  not  only  for 
their  own  support  or  as  the  supplement  of  the  meager  earn- 
ings of  their  fathers  and  husbands,  but  because,  through  the 
force  of  competition  in  a  rapidly  extending  field,  they  threaten 
the  whole  basis  of  the  wage  scale.  From  two-thirds  to  three- 
fourths  of  the  women  workers  in  factories,  stores  and  laun- 
dries, and  in  industrial  occupations  generally,  work  at  wages 


26 

of  less  than  $8  a  week.    Approximately  one-fifth  earn  less  than 
$4  and  nearly  one-half  earn  less  than  $6  a  week. 

Six  dollars  a  week — what  does  it  mean  to  many?  Three 
theater  tickets,  gasoline  for  the  week,  or  the  price  of  a  dinner 
for  two ;  a  pair  of  shoes,  three  pairs  of  gloves,  or  the  cost  of 
an  evening  at  bridge.  To  the  girl  it  means  that  every  penny 
mnst  be  counted,  every  normal  desire  stifled,  and  each  basic 
necessity  of  life  barely  satisfied  by  the  sacrifice  of  some  other 
necessity.  If  more  food  must  be  had  than  is  given  with  15 
cent  dinners,  it  must  be  bought  with  what  should  go  for 
clothes;  if  there  is  need  for  a  new  waist  to  replace  the  old  one 
at  which  the  forewoman  has  glanced  reproachfully  or  at  which 
the  girls  have  giggled,  there  can  be  no  lunches  for  a  week  and 
dinners  must  cost  five  cents  less  each  day.  Always  too  the 
room  must  be  paid  for,  and  back  of  it  lies  the  certainty  that 
with  slack  seasons  will  come  lay-offs  and  discharges.  If  the 
breaking  point  has  come  and  she  must  have  some  amusement, 
where  can  it  come  from?    Surely  not  out  of  $6  a  week. 

Last  of  all  are  the  children,  for  whose  petty  addition  to  the 
stream  of  production  the  Nation  is  paying  a  heavy  toll  in 
ignorance,  deformity  of  body  or  mind,  and  permature  old  age. 
After  all,  does  it  matter  much  what  they  are  paid  ?  for  all  ex- 
perience has  shown  that  in  the  end  the  father 's  wages  are  re- 
duced by  about  the  amount  that  the  children  earn.  This  is  the 
so-called  ' 'family  wage,"  and  examination  of  the  wages  in 
different  industries  corroborates  the  theory  that  in  those  in- 
dustries, such  as  textiles,  where  women  and  children  can  be 
largely  utilized,  the  wages  of  men  are  extremely  low. 

The  competitive  effect  of  the  employment  of  women  and 
children  upon  the  wages  of  men,  can  scarcely  be  overestimated. 
Surely  it  is  hard  enough  to  be  forced  to  put  children  to  work, 
without  having  to  see  the  wages  of  men  held  down  by  their 
employment. 

This  is  the  condition  at  one  end  of  the  social  scale.  What  is 
at  the  other? 

Massed  in  millions,  at  the  other  end  of  the  social  scale,  are 
fortunes  of  a  size  never  before  dreamed  of,  whose  very  owners 


27 

do  not  know  the  extent  nor,  without  the  aid  of  an  intelligent 
clerk,  even  the  sources,  of  their  incomes.    Incapable  of  being 
spent  in  any  legitimate  manner,  these  fortunes  are  burdens, 
which  can  only  be  squandered,  hoarded,  put  into  so-called* 'ben- 
efactions ' '  which  for  the  most  part  constitute  a  menace  to  the 
State,  or  put  back  into  the  industrial  machine  to  pile  up  ever- 
increasing  mountains  of  gold.  * 
In  many  cases,  no  doubt,  these  huge  fortunes  have  come  in 
whole  or  in  part  as  the  rich  reward  of  exceptional  service. 
None  would  deny  or  envy  him  who  has  performed  such  service 
the  richest  of  rewards,  although  one  may  question  the  ideals 
of  a  nation  which  rewards  exceptional  service  only  by  burden- 
some fortunes.    But  such  reward  can  be  claimed  as  a  right 
only  by  those  who  have  performed  service,  not  by  those  who 
through  relationship  or  mere  parasitism  chance  to  be  desig- 
nated as  heirs.    Legal  right,  of  course,  they  have  by  virtue  of 
the  law  of  inheritance,  which,  however,  runs  counter  to  the 
whole  theory  of  American  society  and  which  was  adopted, 
with  important  variations,  from  the  English  law,  without  any 
conception  of  its  ultimate  results  and  apparently  with  the  idea 
that  it  would  prevent  exactly  the  condition  which  has  arisen. 
In  effect  the  American  law  of  inheritance  is  as  efficient  for  the 
establishment  and  maintenance  of  families  as  is  the  English 
law,  which  has  bulwarked  the  British  aristocracy  through  the 
centuries.    Every  year,  indeed,  sees  this  tendency  increase,  as 
the  creation  of  ' '  estates  in  trust ' '  secures  the  ends  which  might 
be  more  simply  reached  if  there  were  no  prohibition  of  "en- 
tail".   According  to  the  income  tax  returns  for  ten  months 
of  1914,  there  are  in  the  United  States  1598  fortunes  yielding 
an  income  of  $100,000  or  more  per  year.    Practically  all  of 
these  fortunes  are  so  invested  and  hedged  about  with  restric- 
tions upon  expenditure  that  they  are,  to  all  intents  and  pur- 
poses, perpetuities. 

An  analysis  of  50  of  the  largest  American  fortunes  shows 
that  nearly  one-half  have  already  passed  to  the  control  of 
heirs  or  to  trustees  (their  vice  regents)  and  that  the  remainder 
will  pass  to  the  control  of  heirs  within  twenty  years,  upon  the. 


28 

deaths  of  the  "founders".  Already,  indeed,  these  founders 
have  almost  without  exception  retired  from  active  service, 
leaving  the  management  ostensibly  to  their  heirs  but  actually 
to  executive  officials  upon  salary. 

We  have,  according  to  the  income  tax  returns,  forty-four 
families  with  incomes  of  $1,000,000  or  more,1  whose  members 
perform  little  or  no  useful  service,  but  whose  aggregate  in- 
comes, totalling  at  the  very  least  fifty  millions  per  year,  are 
equivalent  to  the  earnings  of  100,000  wage  earners  at  the 
average  rate  of  $500. 

The  ownership  of  wealth  in  the  United  States  has  become 
concentrated  to  a  degree  which  is  difficult  to  grasp.  The  re- 
cently published  researches  of  a  statistician  of  conservative 
views2  have  shown  that  as  nearly  as  can  be  estimated  the  dis- 
tribution of  wealth  in  the  United  States  is  as  follows : 

The  "Rich",  2  per  cent  of  the  people,  own  60  per  cent  of  the 
wealth. 

The  "Middle  Class",  33  per  cent  of  the  people,  own  35 
per  cent  of  the  wealth. 

The  "Poor",  65  per  cent  of  the  people,  own  5  per  cent  of 
the  wealth. 

This  means  in  brief  that  a  little  less  than  two  million  peo- 
ple, who  would  make  up  a  city  smaller  than  Chicago,  own  20 
per  cent  more  of  the  Nation 's  wealth  than  all  the  other  ninety 
millions. 

The  figures  also  show  that  with  a  reasonably  equitable  divi- 
sion of  wealth,  the  entire  population  should  occupy  the  posi- 
tion of  comfort  and  security  which  we  characterize  as  Middle 
Class. 

The  actual  concentration  has,  however,  been  carried  very 
much  further  than  these  figures  indicate.  The  largest  pri- 
vate fortune  in  the  United  States,  estimated  at  one  billion 


X — The  income  tax  statistics,  as  a  matter  of  fact,  cover  only  a  period  of  ten 

months  in  1914. 
2 — Prof.  Willard  I.  King,  The  Wealth  and  Income  of  the  People  of  the  United 

States. 


29 

dollars,  is  equivalent  to  the  aggregate  wealth  of  2,500,000  of 
those  who  are  classed  as  "poor",  who  are  shown  in  the  studies 
cited  to  own  on  the  average  about  $400  each. 

Between  the  two  extremes  of  superfluity  and  poverty  is  the 
large  middle  class — farmers,  manufacturers,  merchants,  pro- 
fessional men,  skilled  artisans,  and  salaried  officials —  whose 
incomes  are  more  or  less  adequate  for  their  legitimate  needs 
and  desires,  and  who  are  rewarded  more  or  less  exactly  in 
proportion  to  service.  They  have  problems  to  meet  in  adjust- 
ing expenses  to  income,  but  the  pinch  of  want  and  hunger  is 
not  felt,  nor  is  there  the  deadening,  devitalizing  effect  of  super- 
fluous, unearned  wealth. 

From  top  to  bottom  of  society,  however,  in  all  grades  of  in- 
comes, are  an  innumerable  number  of  parasites  of  every  con- 
ceivable type.  They  perform  no  useful  service,  but  drain  off 
from  the  income  of  the  producers  a  sum  whose  total  can  not  be 
estimated. 

This  whole  situation  has  never  been  more  accurately  des- 
cribed than  by  Hon.  David  Lloyd-George  in  an  address  on 
"Social  Waste": 

I  have  recently  had  to  pay  some  attention  to  the  affairs 
of  the  Sudan,  in  connection  with  some  projects  that  have 
been  mooted  for  irrigation  and  development  in  that  won- 
derful country.  I  will  tell  you  what  the  problem  is, — you 
may  know  it  already.  Here  you  have  a  great,  broad,  rich 
river  upon  which  both  the  Sudan  and  Egypt  depend  for 
their  fertility.  There  is  enough  water  in  it  to  fertilize 
every  part  of  both  countries ;  but  if,  for  some  reason  or 
other,  the  water  is  wasted  in  the  upper  regions,  the  whole 
land  suffers  sterility  and  famine.  There  is  a  large  region 
in  the  Upper  Sudan,  where  the  water  has  been  absorbed 
by  one  tract  of  country,  which,  by  this  process,  has  been 
converted  into  a  morass,  breeding  nothing  but  pestilence. 
Properly  and  fairly  husbanded,  distributed,  and  used, 
there  is  enough  to  fertilize  the  most  barren  valley  and 
make  the  whole  wilderness  blossom  like  the  rose. 

That  represents  the  problem  of  civilization,  not  merely 


30 

in  this  country  but  in  all  lands.  Some  men  get  their  fair 
share  of  wealth  in  a  land  and  no  more — sometimes  even 
the  streams  of  wealth  overflow  to  waste  over  some  favored 
regions,  often  producing  a  morass,  which  poisons  the 
social  atmosphere.  Many  have  to  depend  on  a  little  trick- 
ling runlet,  which  quickly  evaporates  with  every  com- 
mercial or  industrial  drought;  sometimes  you  have 
masses  of  men  and  women  whom  the  flood  at  its  height 
barely  reaches,  and  then  you  witness  parched  specimens 
of  humanity,  withered,  hardened  in  misery,  living  in  a 
desert  where  even  the  well  of  tears  has  long  ago  run  dry. 

Besides  the  economic  significance  of  these  great  inequalities 
of  wealth  and  income,  there  is  a  social  aspect  which  equally 
merits  the  attention  of  Congress.  It  has  been  shown  that  the 
great  fortunes  of  those  who  have  profited  by  the  enormous 
expansion  of  American  industry  have  already  passed,  or  will 
pass  in  a  few  years,  by  right  of  inheritance  to  the  control  of 
heirs  or  to  trustees  who  act  as  their  "vice  regents".  They 
are  frequently  styled  by  our  newspapers  "monarchs  of  in- 
dustry," and  indeed  occupy  within  our  Republic  a  position 
almost  exactly  analogous  to  that  of  feudal  lords. 

These  heirs,  owners  only  by  virtue  of  the  accident  of  birth, 
control  the  livelihood  and  have  the  power  to  dictate  the  happi- 
ness of  more  human  beings  than  populated  England  in  the 
Middle  Ages.  Their  principalities,  it  is  true,  are  scattered 
and,  through  the  medium  of  stock-ownership,  shared  in  part 
with  others ;  but  they  are  none  the  less  real.  In  fact,  such  scat- 
tered, invisible  industrial  principalities  are  a  greater  menace 
to  the  welfare  of  the  Nation  than  would  be  equal  power  con- 
solidated into  numerous  petty  kingdoms  in  different  parts  of 
the  country.  They  might  then  be  visualized  and  guarded 
against ;  now  their  influence  invisibly  permeates  and  controls 
every  phase  of  life  and  industry. 

"The  king  can  do  no  wrong"  not  only  because  he  is  above 
the  law,  but  because  every  function  is  performed  or  responsi- 
bility assumed  by  his  ministers  and  agents.     Similarly  our 


31 

Rockefellers,  Morgans,  Fricks,  Vanderbilts  and  Astors  can  do 
no  industrial  wrong,  because  all  effective  action  and  direct 
responsibility  is  shifted  from  them  to  the  executive  officials 
who  manage  American  industry.  As  a  basis  for  this  con- 
clusion we  have  the  testimony  of  many,  among  which,  how- 
ever, the  following  statements  stand  out  most  clearly : 

Mr.  John  D.  Rockefeller,  Jr.1 

*  *  *  those  of  us  who  are  in  charge  there  elect  the 
ablest  and  most  upright  and  competent  men  whom  we  can 
find,  in  so  far  as  our  interests  give  us  the  opportunity  to 
select,  to  have  the  responsibility  for  the  conduct  of  the 
business  in  which  we  are  interested  as  investors.  We  can 
not  pretend  to  follow  the  business  ourselves. 

Mr.  J.  Pierpont  Morgan. 

Chairman  Walsh.  In  your  opinion,  to  what  extent  are 
the  directors  of  corporations  responsible  for  the  labor 
conditions  existing  in  the  industries  in  which  they  are  the 
directing  power? 

Mr.  Morgan.    Not  at  all  I  should  say. 

The  similitude,  indeed,  runs  even  to  mental  attitude  and 
phrase.    Compare  these  two  statements : 

Mr.  John  D.  Rockefeller,  Jr. 

My  appreciation  of  the  conditions  surrounding  wage- 
earners  and  my  sympathy  with  every  endeavor  to  better 
these  conditions  are  as  strong  as  those  of  any  man. 

Louis  XVI. 

There  is  none  but  you  and  me  that  has  the  people 's  in- 
terest at  heart.  ("II  n'y  a  que  vous  et  moi  qui  aimions  le 
peuple.") 

The  families  of  these  industrial  princes  are  already  well 
established  and  are  knit  together  not  only  by  commercial  al- 

1 — Before  Congressional  Investigating  Committee. 


32 

liances  but  by  a  network  of  intermarriages  which  assures  har- 
monious action  whenever  their  common  interest  is  threatened. 

Effective  action  by  Congress  is  required,  therefore,  not  only 
to  readjust  on  a  basis  of  compensation  approximating  the 
service  actually  performed,  the  existing  inequalities  in  the 
distribution  of  wealth  and  income,  but  to  check  the  growth  of 
an  hereditary  aristocracy,  which  is  foreign  to  every  conception 
of  American  Government  and  menacing  to  the  welfare  of  the 
people  and  the  existence  of  the  Nation  as  a  democracy. 

The  objects  to  be  attained  in  making  this  readjustment  are : 
To  reduce  the  swollen,  unearned  fortunes  of  those  who  have 
a  superfluity ;  to  raise  the  underpaid  masses  to  a  level  of  decent 
and  comfortable  living;  and  at  the  same  time  to  accomplish 
this  on  a  basis  which  will,  in  some  measure,  approximate  the 
just  standard  of  income  proportional  to  service. 

The  discussion  of  how  this  can  best  be  accomplished  forms 
the  greater  part  of  the  remainder  of  this  report,  but  at  this 
point  it  seems  proper  to  indicate  one  of  the  most  immediate 
steps  which  need  to  be  taken. 

It  is  suggested  that  the  Commission  recommend  to  Congress 
the  enactment  of  an  inheritance  tax,  so  graded  that,  while 
making  generous  provision  for  the  support  of  dependents  and 
the  education  of  minor  children,  it  shall  leave  no  large  accu- 
mulation of  wealth  to  pass  into  hands  which  had  no  share  in 
its  production.1  The  revenue  from  this  tax,  which  we  are 
informed  would  be  very  great,  should  be  reserved  by  the 
Federal  Government  for  three  principal  purposes : 

1.  The  extension  of  education. 

2.  The  development  of  other  important   social  services 

which  should  properly  be  performed  by  the  Nation, 
which  are  discussed  in  detail  elsewhere. 


1— It  is  suggested  that  the  rates  he  so  graded  that  not  more  than  one 
million  dollars  shall  pass  to  the  heirs.  This  can  be  equitably  accom- 
plished by  several  different  gradations  of  taxation. 


33 

3.  The  development,  in  cooperation  with  States  and  mu- 
nicipalities, of  great  constructive  works,  such  as  road 
building,  irrigation  and  reforestation,  which  would 
materially  increase  the  efficiency  and  welfare  of  the 
entire  Nation. 

"We  are  informed  by  counsel  not  only  that  such  a  tax  is 
clearly  within  the  power  of  Congress,  but  that  upon  two  oc- 
casions, namely,  during  the  Civil  War  and  in  1898,  such  graded 
inheritance  taxes  were  enacted  with  scarcely  any  opposition 
and  were  sustained  by  the  Supreme  Court,  which  held  that  the 
inheritance  tax  was  not  a  direct  tax  within  the  meaning  of  the 
Constitution.  We  are  aware  that  similar  taxes  are  levied  in 
the  various  States,  but  the  conflict  with  such  State  taxes  seems 
to  have  presented  little  difficulty  during  the  period  in  which 
the  tax  of  1898  was  in  effect.  Under  any  circumstances  this 
need  cause  no  great  complication,  as  the  matter  could  be 
readily  adjusted  by  having  the  Federal  Government  collect  the 
entire  tax  and  refund  a  part  to  the  States  on  an  equitable  basis. 

There  is  no  legislation  which  could  be  passed  by  Congress 
the  immediate  and  ultimate  efforts  of  which  would  be  more 
salutary  or  would  more  greatly  assist  in  tempering  the  exist- 
ing spirit  of  unrest. 


2.     Unemployment  and  Denial  of  Opportunity  to  Earn 

a  Living. 

As  a  prime  cause  of  a  burning  resentment  and  a  rising 
feeling  of  unrest  among  the  workers,  unemployment  and  the 
denial  of  an  opportunity  to  earn  a  living  is  on  a  parity  with 
the  unjust  distribution  of  wealth.  They  may  on  final  analysis 
prove  to  be  simply  the  two  sides  of  the  same  shield,  but 
that  is  a  matter  which  need  not  be  discussed  at  this  point. 
They  differ  in  this,  however,  that  while  unjust  distribution  of 
wealth  is  a  matter  of  degree,  unemployment  is  an  absolute 
actuality,  from  which  there  is  no  relief  but  soul-killing  crime 
and  soul-killing  charity. 


34 

To  be  forced  to  accept  employment  on  conditions  which 
are  insufficient  to  maintain  a  decent  livelihood  is  indeed  a 
hardship,  but  to  be  unable  to  get  work  on  any  terms  whatever 
is  a  position  of  black  despair. 

A  careful  analysis  of  all  available  statistics  shows  that  in 
our  great  basic  industries  the  workers  are  unemployed  for  an 
average  of  at  least  one-fifth  of  the  year,  and  4;hat  at  all  times 
during  any  normal  year  there  is  an  army  of  men,  who  can  be 
numbered  only  by  hundreds  of  thousands,  who  are  unable  to 
find  work  or  who  have  so  far  degenerated  that  they  can  not 
or  will  not  work.  Can  any  nation  boast  of  industrial  efficiency 
when  the  workers,  the  source  of  her  productive  wealth,  are  em- 
ployed to  so  small  a  fraction  of  their  total  capacity? 

Fundamentally  this  unemployment  seems  to  rise  from  two 
great  causes,  although  many  others  are  contributory.  First, 
the  inequality  of  the  distribution  of  income,  which  leaves  the 
great  masses  of  the  population  (the  true  ultimate  consumers) 
unable  to  purchase  the  products  of  industry  which  they  create, 
while  a  few  have  such  a  superfluity  that  it  can  not  be  normally 
consumed  but  must  be  invested  in  new  machinery  for  produc- 
tion or  in  the  further  monopolization  of  land  and  natural 
resources.  The  result  is  that  in  mining  and  other  basic  indus- 
tries we  have  an  equipment  in  plant  and  developed  property 
far  in  excess  of  the  demands  of  any  normal  year,  the  excess 
being,  in  all  probability,  at  least  25  per  cent.  Each  of  these 
mines  and  industrial  plants  keeps  around  it  a  labor  force 
which,  on  the  average,  can  get  work  for  only  four-fifths  of  the 
year,  while  at  the  same  time  the  people  have  never  had  enough 
of  the  products  of  those  very  industries — have  never  been 
adequately  fed,  clothed,  housed,  nor  warmed — for  the  very 
simple  reason  that  they  have  never  been  paid  enough  to  permit 
their  purchase. 

The  second  principal  cause  lies  in  the  denial  of  access  to 
land  and  natural  resources  even  when  they  are  unused  and 
unproductive,  except  at  a  price  and  under  conditions  which 
are  practically  prohibitive.  This  situation,  while  bound  up 
with  the  land  and  taxation  policies  of  our  States  and  Nation, 


35 

also  rests  fundamentally  upon  the  unjust  distribution  of 
wealth.  Land  or  mineral  resources  in  the  hands  of  persons 
of  average  income  must  and  will  be  used  either  by  their  orig- 
inal owners  or  by  some  more  enterprising  person.  By  the 
overwhelming  forces  of  economic  pressure,  taxation,  and  com- 
petition they  can  not  be  permitted  to  lie  idle  if  they  will  pro- 
duce anything  which  the  people  need.  Only  in  the  hands  of 
large  owners — free  from  economic  pressure,  able  to  evade 
or  minimize  the  effects  of  taxation  and  to  await  the  ripening 
of  the  fruits  of  unearned  increment — can  land  be  held  out  of 
use  if  its  products  are  needed. 

There  can  be  no  more  complete  evidence  of  the  truth  of  this 
statement  than  the  condition  of  the  farms  of  1000  acres  and 
over,  which,  valued  at  two  and  one-third  billion  dollars,  com- 
prise 19  per  cent  of  all  the  farm  land  of  the  country  and  are 
held  by  less  than  one  per  cent  of  the  farm  owners.  The  United 
States  Census  returns  show  that  in  these  1000-acre  farms  only 
18.7  per  cent  of  the  land  is  cultivated  as  compared  with  60  to 
70  per  cent  in  farms  of  from  50  to  499  acres.  Furthermore, 
it  is  well  known  that  the  greater  part  of  these  smaller  farms 
which  are  left  uncultivated  are  held  by  real  estate  men, 
bankers  and  others  who  have  independent  sources  of  income. 
More  than  four-fifths  of  the  area  of  the  large  holdings  is 
being  held  out  of  active  use  by  their  50,000  owners,  while 
2,250,000  farmers  are  struggling  for  a  bare  existence  on  farms 
of  less  than  50  acres,  and  an  untold  number  who  would 
willingly  work  these  lands  are  swelling  the  armies  of  the  un- 
employed in  the  cities  and  towns. 

A  basic  theory  of  our  Government,  which  found  expression 
in  the  Homestead  Acts,  was  that  every  man  should  have  op- 
portunity to  secure  land  enough  to  support  a  family.  If  this 
theory  had  been  carried  out  and  homesteads  had  either  gone 
to  those  who  would  use  them  productively  or  remained  in 
the  hands  of  the  Government,  we  should  not  yet  have  a  prob- 
lem of  such  a  character.  But  these  acts  were  evaded;  land 
was  stolen  outright  by  wholesale,  and  fraudulent  entries  were 
consolidated  into  enormous  tracts  which  are  now  held  by 
wealthy  individuals  and  corporations. 


36 

The  Public  Lands  Commission,  after  an  exhaustive  inquiry, 
reported  in  1905 : 

Detailed  study  of  the  practical  operation  of  the  present 
land  laws  shows  that  their  tendency  far  too  often  is  to 
bring  about  land  monopoly  rather  than  to  multiply  small 
holdings  by  actual  settlers. 

*  *  *  Not  infrequently  their  effect  is  to  put  a 
premium  on  perjury  and  dishonest  methods  in  the  ac- 
quisition of  land.  It  is  apparent,  in  consequence,  that  in 
very  many  localities,  and  perhaps  in  general,  a  larger 
proportion  of  the  public  land  is  passing  into  the  hands  of 
speculators  than  into  those  of  actual  settlers  making 
homes.  *  *  *  Nearly  everywhere  the  large  land- 
owner has  succeeded  in  monopolizing  the  best  tracts, 
whether  of  timber  or  agricultural  land.1 

To  one  who  has  not  read  the  preceding  statements  carefully, 
there  may  seem  to  be  a  contradiction  in  proposing  to  prevent 
great  capitalists  from  creating  an  excess  of  productive  ma- 
chinery and  overdeveloping  mineral  resources,  while  pointing 
out  the  necessity  of  forcing  land  and  other  natural  resources 
into  full  and  effective  use  by  the  people.  The  two  proposi- 
tions are,  as  a  matter  of  fact,  as  fundamentally  distinct  as 
monopoly  and  freedom.  The  capitalist  increases  his  holdings 
in  productive  machinery  and  resources  only  because  through 
monopolization  and  maintenance  of  prices  he  hopes  to  reap 
rewards  for  himself  or  increase  his  power,  while  the  aim  in 
desiring  the  full  development  of  land  and  other  resources 
by  the  people  is  that  they,  producing  for  themselves,  may 
enjoy  a  sufficiency  of  good  things  and  exchange  them  for  the 
products  of  others,  and  thus  reduce  to  a  minimum  the  con- 
dition of  unemployment. 

There  are,  of  course,  many  other  causes  of  unemployment 
than  the  inequality  of  wealth  and  the  monopolization  of  land 
which  there  is  no  desire  to  minimize.  Chief  among  these  are 
immigration,  the  inadequate  organization  of  the  labor  mar- 

1 — Senate  Doc.  154,  58th  Cong.,  3d  Sess.,  p.  14. 


37 

ket,  the  seasonal  character  of  many  industries,  and  the  per- 
sonal deficiencies  of  a  very  large  number  of  the  unemployed. 
It  can  not  be  denied  that  a  considerable  proportion  of  the 
men  who  fill  the  city  lodging  houses  in  winter  are  virtually 
unemnloyables,  as  a  result  of  weakness  of  character,  lack  of 
training,  the  debasing  effects  of  lodging  house  living  and 
city  dissipation,  and,  last  but  not  least,  the  conditions  under 
which  they  are  forced  to  work  in  the  harvest  fields  and  lumber, 
railroad  and  construction  camps.  The  seasonal  fluctuations 
of  our  industries  are  enormous,  employing  hundreds  of  thou- 
sands during  the  busy  season  and  throwing  them  out  on  the 
community  during  the  dull  season,  and  almost  nothing  has 
been  done  to  remedy  this  condition.  It  would  be  difficult  to 
imagine  anything  more  chaotic  and  demoralizing  than  the 
existing  methods  of  bringing  workmen  and  jobs  together. 
Certain  measures  for  dealing  with  these  conditions,  which 
are  discussed  elsewhere  in  the  report,  need  to  be  pushed  for- 
ward with  all  possible  vigor.  But  it  may  be  confidently  pre- 
dicted that  the  unemployment  situation  will  not  be  appreciably 
relieved  until  great  advances  have  been  made  in  the  removal 
of  the  two  prime  causes — unjust  distribution  of  wealth  and 
monopolization  of  land  and  natural  resources. 

The  most  direct  methods  of  dealing  with  the  inequality  of 
wealth  have  already  been  briefly  discussed  and  will  be  con- 
sidered elsewhere  in  the  report.  "With  respect  to  the  land  ques- 
tion, however,  the  following  basic  suggestions  are  submitted : 

1.  Vigorous  and  unrelenting  prosecution  to  regain 
all  land,  water  power  and  mineral  rights  secured  from 
the  Government  by  fraud. 

2.  A  general  revision  of  our  land  laws,  so  as  to  apply 
to  all  future  land  grants  the  doctrine  of  " superior  use", 
as  in  the  case  of  water  rights  in  California,  and  provision 
for  forfeiture  in  case  of  actual  nonuse.  In  its  simplest 
form  the  doctrine  of  "superior  use"  implies  merely  that 
at  the  time  of  making  the  lease  the  purpose  for  which 
the  land  will  be  used  must  be  taken  into  consideration, 


38 

and  the  use  which  is  of  greatest  social  value  shall  be 
given  preference. 

3.  The  forcing  of  all  unused  land  into  use  by  making 
the  tax  on  nonproductive  land  the  same  as  on  productive 
land  of  the  same  kind,  and  exempting  all  improvements. 

Other  measures  for  dealing  with  unemployment  are  dis- 
cussed under  that  head  on  p.  181. 

The  unemployed  have  aptly  been  called  ' '  the  shifting  sands 
beneath  the  State".  Surely  there  is  no  condition  which  more 
immediately  demands  the  attention  of  Congress  than  that  of 
unemployment,  which  is  annually  driving  hundreds  of  thou- 
sands of  otherwise  productive  citizens  into  poverty  and  bitter 
despair,  sapping  the  very  basis  of  our  national  efficiency  and 
germinating  the  seeds  of  revolution. 


3.     Denial  of  Justice. 

No  testimony  presented  to  the  Commission  has  left  a  deeper 
impression  than  the  evidence  that  there  exists  among  the 
workers  an  almost  universal  conviction  that  they,  both  as  in- 
dividuals and  as  a  class,  are  denied  justice  in  the  enactment, 
adjudication,  and  administration  of  law,  that  the  very  instru- 
ments of  democracy  are  often  used  to  oppress  them  and  to 
place  obstacles  in  the  way  of  their  movement  towards  econ- 
omic, industrial,  and  political  freedom  and  justice.  Many 
witnesses,  speaking  for  millions  of  workers  as  well  as  for 
themselves,  have  asserted  with  the  greatest  earnestness  that 
the  mass  of  the  workers  are  convinced  that  laws  necessary 
for  their  protection  against  the  most  grievous  wrongs  can  not 
be  passed  except  after  long  and  exhausting  struggles;  that 
such  beneficient  measures  as  become  laws  are  largely  nullified 
by  the  unwarranted  decisions  of  the  courts;  that  the  laws 
which  stand  upon  the  statute  books  are  not  equally  enforced, 
and  that  the  whole  machinery  of  government  has  frequently 
been  placed  at  the  disposal  of  the  employers  for  the  oppression 


39 

of  the  workers ;  that  the  Constitution  itself  has  been  ignored 
in  the  interests  of  the  employers;  and  that  constitutional 
guaranties  erected  primarily  for  the  protection  of  the  workers 
have  been  denied  to  them  and  used  as  a  cloak  for  the  misdeeds 
of  corporations. 

If  it  be  true  that  these  statements  represent  the  opinions 
of  the  mass  of  American  workers,  there  is  reason  for  grave 
concern,  for  there  are  twenty-five  millions  of  them,  of  whom 
three  millions  are  welded  together  into  compact  organizations. 

But  if  it  be  true  that  these  charges  are  justified;  if,  in  fact, 
our  legislators,  our  judges  and  executives,  do  not  afford  equal 
consideration  to  the  workers  and  are  concerned  with  protect- 
ing the  rights  of  property  rather  than  the  rights  of  men,  and 
at  times  even  become  the  instruments  for  the  oppression  of 
the  poor  and  humble,  then  the  situation  demands  and  must 
receive  the  prompt  and  decisive  action  of  every  right  thinking 
man  in  order  that  these  evils  may  be  eradicated  and  justice 
and  liberty  established  in  the  place  of  injustice  and  oppression. 

Before  examining  the  evidence,  it  should  be  understood 
that  it  is  not  charged  that  such  acts  of  injustice  are  universal 
but  that  they  occur  so  frequently  and  in  such  diverse  parts  of 
the  country  that  any  man  may  reasonably  fear  that  he  him- 
self or  those  with  whom  he  is  associated  may  at  any  time  be 
the  victim  of  injustice  or  discrimination.  It  has  been  urged, 
and  perhaps  properly,  that  the  charges  would  be  sustained  if 
it  were  found  that  such  acts  of  injustice  had  been  committed 
only  upon  rare  occasions,  if  it  should  also  be  established  that 
such  injustices  were  allowed  to  stand  without  redress,  and  if 
those  who  were  guilty  of  their  commission  were  left  unim- 
peached  and  unpunished. 

An  enormous  mass  of  evidence  bearing  upon  these  charges 
has  been  presented  to  the  Commission  by  witnesses  or  collected 
by  its  staff.  This  material  is  presented  in  some  detail  in 
another  part  of  the  report,  but  the  summary  which  follows 
may  be  regarded  as  reasonably  full  and  exact. 

First,  with  regard  to  the  enactment  of  laws,  it  is  charged 
that  the  workers  have  been  unable  to  secure  legislation  to  pro- 


40 

tect  them  against  grievous  wrongs,  except  after  exhausting 
struggles  against  overwhelming  odds  and  against  insidious 
influences. 

The  evidence  bearing  upon  this  question  has  dealt  with  the 
history  of  three  principal  lines  of  legislation  in  which  the  evils 
sought  to  be  remedied  are  now  universally  admitted  to  have 
been  very  great,  involving  wanton  destruction  of  life,  the  ex- 
ploitation of  women  and  children,  and  the  practical  enslave- 
ment of  American  seamen.  A  careful  examination  has  been 
made  of  the  history  of  attempts  to  secure  adequate  legislation 
to  prevent  child  labor,  to  protect  women  against  extreme 
hours  of  labor  and  night  work,  to  secure  the  safety  of  fac- 
tories, railroads  and  mines,  and  to  provide  for  the  safety, 
comfort  and  liberty  of  seamen. 

The  history  of  child  labor  legislation  shows  that  although 
agitation  for  the  protection  and  education  of  children  began 
during  the  early  part  of  the  nineteenth  century  in  Massachu- 
setts, Rhode  Island,  Connecticut,  New  York  and  Pennsylvania, 
no  adequate  legislation  was  obtained  until  nearly  the  end  of 
the  century.  Time  after  time  in  each  of  these  industrial  States 
the  sentiment  of  the  public  was  aroused,  organization  was  ef- 
fected, and  well-drafted  bills  were  introduced  only  to  be  killed 
in  committee,  emasculated  or  killed  on  the  floor  of  the  legis- 
lature, or  passed  with  exceptions  which  rendered  them  en- 
tirely ineffective.  Even  the  attempt  to  reduce  the  hours  of 
children  below  12  per  day  was  bitterly  contested  and  met  by 
every  known  trick  of  legislative  chicanery.  The  whole  history 
of  the  contest  for  adequate  child  labor  legislation  is  even  now 
being  repeated  in  some  of  the  Southern  states,  where  laws 
prohibiting  the  employment  of  children  are  bitterly  contested 
and  beaten  session  after  session  by  legislators,  unsympathetic 
or  controlled  by  the  cotton-mill  interests. 

Similarly,  although  the  movement  to  restrict  the  working 
hours  of  women  and  to  prohibit  night  work  began  in  Massachu- 
setts and  Pennsylvania  as  early  as  1840,  the  first  legislation 
limiting  the  hours  was  the  10-hour  bill  passed  in  Massachu- 


41 

setts,  in  1874,  and  night  work  went  unregulated  until  the 
passage  of  the  act  of  1899  in  Nebraska.1 

The  movement  for  safety  of  life  and  limb  in  the  factories 
and  workshops,  although  pushed  with  great  vigor  in  almost 
every  session  of  the  State  legislatures  after  1880,  secured  only 
a  few  acts  providing  for  such  obvious  matters  as  the  guard- 
ing of  set  screws  and  gears,  but  made  practically  no  provision 
for  their  enforcement.  No  really  effective  action  to  promote 
safety  took  place  until,  after  many  years  of  hard  fighting,  the 
first  workmen's  compensation  acts  were  passed  between  1900 
and  1910,  which  for  the  first  time  made  the  unsafe  condition 
of  factories  directly  expensive. 

Even  upon  the  railroads,  where  the  safety  of  the  public 
as  well  as  of  the  workers  was  involved,  at  least  ten  years 
of  constant  agitation  on  the  part  of  the  railroad  brotherhoods 
and  various  interested  citizens  was  necessary  before  the  first 
Federal  act  providing  for  safety  appliances  was  passed  in 
1893. 

In  the  case  of  the  movement  to  secure  the  safety,  comfort, 
and  liberty  of  seamen,  it  is  a  matter  of  record  that  Andrew 
Furuseth,  President  of  the  Seamen's  Union,  backed  not  only 
by  all  the  members  of  his  own  organization  but  by  the  entire 
American  labor  movement,  attended  each  session  of  Congress 
and  devoted  his  whole  energies  to  securing  legislation  upon 
this  subject  for  the  entire  period  of  22  years  from  1893  to 
1915,  when  the  Seamen's  Bill  finally  became  a  law. 


-It  is  worthy  of  note  that  although  the  decision  on  the  Massachusetts  law 
was  favorable  and  thus  established  a  precedent  {Commonwealth  y.  Ham- 
ilton Mfg.  Co.,  120  Mass.  383),  it  was  thrown  aside  by  the  Illinois  court 
in  1895  in  holding  unconstitutional  a  law  of  that  State  prescribing  an 
eight-hour  day  for  women  (Ritchie  v.  People,  155  111.  98),  and  it  was  not 
until  1910  that  the  same  court  accepted  a  ten-hour  law  as  constitutional 
(Ritchie  v.  Wyman,  244  111.  509).  The  Nebraska  statute  limited  the 
hours  of  women  to  ten  a  day  and  prohibited  night  work  between  the 
hours  of  10  p.  m.  and  6  a.  m.,  but  the  first  case  did  not  raise  the  question 
of  night  work  (Wenham  v.  State,  65  Neb.  394).  In  New  York,  however, 
a  statute  regulating  night  work  was  held  unconstitutional  in  1907 
(People  v.  Williams,  189  N.  Y.  131)  and  it  was  not  until  the  present  year 
that  a  similar  law  was  sustained  (People  v.  Schweinler  Press,  214  N.  Y. 
395). 


y 


42 

Other  evidence  has  been  presented  covering  the  long  fights 
to  secure  legislation  to  remove  the  evils  of  company  stores, 
payment  in  scrip,  prison  labor,  arbitrary  deductions  from 
wages,  "sweating",  tenement  houses,  and  a  number  of  other 
matters  upon  which  adequate  legislation  has  not  yet  been  se- 
cured, except  perhaps  in  a  few  States,  although  there  has  been 
unremitting  agitation  upon  these  questions  for  more  than 
half  a  century.  This  evidence  shows  clearly  that  the  workers 
have  just  grounds  for  the  charge  that  the  legislatures  have 
been  criminally  slow  in  acting  for  the  relief  of  grievous  wrongs 
and  have  used  every  subterfuge  to  escape  adequate  and  ag- 
gressive action,  even  while  thousands  of  men,  women,  and 
children  were  being  killed,  maimed,  or  deformed  as  a  result 
of  their  negligence. 

Evidence  has  further  been  presented  to  show  that  such  a 
condition  has  not  been  the  result  entirely  of  the  complacency 
or  8lothfulness  of  legislators,  but  that  powerful  influences 
have  been  at  work  to  prevent  such  remedial  legislation.  The 
most  convincing  evidence  presented  upon  this  phase  of  the 
question  is  the  record  of  the  National  Association  of  Manu- 
facturers and  its  allied  organizations,  as  contained  in  the  tes- 
timony and  findings  before  Congressional  committees,1  in  the 
printed  reports  of  that  Association,  and  in  the  testimony  be- 
fore the  Commission  of  the  representatives  of  various  state 
employers'  associations.  The  substance  of  this  evidence  is 
so  well  known  to  Congress  and  to  the  public  that  it  is  neces- 
sary here  to  call  attention  only  to  the  fact  that  the  efforts  of 
such  associations  in  preventing  the  enactment  of  practically 
all  legislation  intended  to  improve  the  condition  or  advance 
the  interests  of  workers  were  not  confined  to  Congress,  but 
were  even  more  effective  in  the  State  legislatures. 


-U.  S.  Senate  Committee  on  Judiciary.  Maintenance  of  a  lobby  to  in- 
fluence legislation:  Hearings  before  a  subcommittee  pursuant  to  S. 
Res.  92,  63d  Cong.,  1st  Sess. 

Charges  against  members  of  the  House  and  lobby  activities  of  the 
National  Association  of  Manufacturers  of  the  United  States  and  others: 
Hearings  before  select  committee  of  House  of  Representatives  appointed 
under  H.  Res.  198,  63d  Cong.,  1st  Sess. 


43 

The  persistent  and  bitter  manner  in  which  the  railroads 
fought  the  laws  providing  for  safety  appliances,  although 
the  measures  were  moderate  and  necessary  not  only  for  the 
safety  of  the  traveling  public  but  for  the  efficient  operation 
of  the  roads,  is  well  known  to  Congress. 

Perhaps  the  most  significant  statement  regarding  the  in- 
sidious influences  of  this  character  is  contained  in  a  letter 
from  Mr.  L.  M.  Bowers,  Chairman  of  the  Board  of  Directors 
of  the  Colorado  Fuel  &  Iron  Co.,  to  the  Secretary  of  Mr. 
John  D.  Rockefeller,  Jr.,  under  date  of  May  13,  1913. 

The  Colorado  Fuel  and  Iron  Company  for  many  years 
were  accused  of  being  the  political  dictator  of  southern 
Colorado,  and  in  fact  were  a  mighty  power  in  the  entire 
state.  When  I  came  here  it  was  said  that  the  C.  F.  &  I. 
Co.  voted  every  man  and  woman  in  their  employ  without 
any  regard  to  their  being  naturalized  or  not;  and  even 
their  mules,  it  used  to  be  remarked,  were  registered  if 
they  were  fortunate  enough  to  possess  names.  Any- 
how, a  political  department  was  maintained  at  a  heavy 
expense.  I  had  before  me  the  contributions  of  the  C.  F. 
&  I.  Co.  for  the  campaign  of  1904,  amounting  to  $80,605.00, 
paid  out  personally  by  President  Hearne.  All  the  vouch- 
ers and  checks  I  have  examined  personally,  all  of  which 
were  payable  to  Albert  A.  Miller,  upon  which  he  drew 
the  currency  and,  it  is  said,  handed  the  money  over  to 
Mr.  Hearne,  who  paid  it  out.  So  far  as  I  can  discover, 
not  one  particle  of  good  was  accomplished  for  the  com- 
pany ;  but  Mr.  Hearne  was  an  aspirant  for  the  position  of 
United  States  senator  and  devoted  a  vast  amount  of  time 
and  money  with  this  end  in  view,  I  have  no  doubt. 

The  company  became  notorious  in  many  sections  for 
their  support  of  the  liquor  interests.  They  established 
saloons  everywhere  they  possibly  could.  This  depart- 
ment was  managed  by  one  John  Kebler,  a  brother  of  the 
one-time  president  of  the  company,  who  died,  about  the 
time  I  came  here,  a  victim  of  his  own  intemperate  habits. 
A  sheriff,  elected  by  the  votes  of  the  C.  F.  &  I.  Co.  em- 


44 

ployees,  and  who  has  been  kept  in  office  a  great  many- 
years,  established  himself  or  became  a  partner  in  sixteen 
liquor  stores  in  our  coal  mines.  To  clean  up  the  saloons 
and  with  them  the  gambling  hells  and  houses  of  prosti- 
tution, has  been  one  of  the  things  that  Mr.  Welborn  and 
I  have  devoted  an  enormous  amount  of  time  to  during 
the  past  five  years.  The  decent  newspapers  everlast- 
ingly lampooned  the  C.  F.  &  I.  Co.  at  every  election ;  and 
I  am  forced  to  say  the  company  merited,  from  a  moral 
standpoint,  every  shot  that  was  fired  into  their  camp. 

Since  I  came  here1  not  a  nickel  has  been  paid  to  any 
politician  or  political  party.  We  have  fought  the  saloons 
with  all  the  power  we  possess.  We  have  forbidden  any 
politician  from  going  into  our  camps,  and  every  subor- 
dinate official  connected  with  the  Company  has  been  for- 
bidden to  influence  our  men  to  vote  for  any  particular 
candidate.  We  have  not  lobbied  in  the  Legislature,  but 
have  gone  directly  to  the  Governor  and  other  able  men  and 
have  demanded  fair  treatment. 

Second,  it  is  charged  by  the  workers  that  after  wholesome 
and  necessary  laws  are  passed  they  are  in  large  part  nulli- 
fied by  the  courts  either  upon  technicalities  of  a  character 
which  would  not  be  held  to  invalidate  legislation  favorable  to 
the  interests  of  manufacturers,  merchants,  bankers,  and  other 
property  owners,  or  thrown  out  on  the  broad  ground  of  un- 
constitutionality, through  strained  or  illogical  construction  of 
constitutional  provisions.  It  is  argued  that  such  action  is 
doubly  evil  because  the  power  to  declare  legislative  acts  un- 

1 — This  statement  of  Mr.  Bowers  should  be  considered  in  conjunction  with 
his  testimony  that  the  evil  influences  created  by  the  Colorado  Fuel  &  Iron 
Co.  were  still  in  power  and  his  admission  that  the  Company  was  deeply 
Interested  in  the  last  State  election  and  that  150  men  were  put  into  the 
field  from  his  office  alone  to  work  for  the  candidates  favored  by  the 
Company,  which  was  deeply  interested  in  the  election  of  officials  who 
would  vigorously  prosecute  the  strikers.  His  letters  narrating  how  the 
Governpr  of  Colorado  was  whipped  into  line  should  also  be  considered, 
as  well  as  the  testimony  of  Dr.  E.  S.  Gaddis,  former  head  of  the  Socio- 
logical Department  of  the  Colorado  Fuel  &  Iron  Co.,  that  officials  openly 
influenced  elections. 


45 

constitutional  has  been  assumed  by  the  courts  in  the  face  of 
a  complete  absence  of  legal  sanction,  in  complete  disregard 
of  early  decisions  denying  the  possession  of  such  power,  and 
in  complete  contrast  to  the  practices  of  the  courts  in  every 
other  country  of  the  civilized  world.  It  is  not  within  our  prov- 
ince to  decide  whether  or  not  this  assumption  of  power  by 
the  courts  was  justified.  It  is  sufficient  here  merely  to  exam- 
ine the  evidence  bearing  upon  the  allegations  that  laws  neces- 
sary for  the  correction  of  grave  industrial  abuses  are  nullified 
by  strained  interpretations  or  for  reasons  which  would  be 
insufficient  in  other  cases,  and  that  they  are  held  unconstitu- 
tional upon  pretexts  which  in  reality  are  the  outgrowth  of 
economic  bias  on  the  part  of  the  judges. 

A  large  number  of  decisions  illustrating  these  points  have 
been  brought  to  the  attention  of  the  Commission,  but  only  a 
few  need  be  cited  here.  It  has  been  held,  for  example,  even 
that  statutes  requiring  dangerous  machinery  to  be  guarded 
may  be  disobeyed  by  the  employer,  and  children  employed 
about  such  unguarded  machinery  are  held  to  have  assumed  the 
risk.1  The  same  has  been  held  regarding  the  employment  of 
women.2 

Many  other  cases  might  be  cited  on  the  question  of  strained 
interpretation,3  bearing  out  the  assertion  made  by  Justice  Lur- 
ton  of  the  Federal  Supreme  Court,  when,  in  a  case  not  in- 
volving industrial  relations,  he  says : 

The  judgment  just  rendered  will  have,  as  I  think,  the 
effect  to  defeat  the  clearly  expressed  will  of  the  Legisla- 
ture by  a  construction  of  its  words  that  cannot  be  re- 
conciled with  their  ordinary  meaning.4 


l—Higgins  v.  O'Keefe,  79  Fed.  900;  White  v.  Wittemann  Lith.  Co.,  131  N.  Y. 
631. 

2—Knisley  v.  Pratt,  148  N.  Y.  372. 

Z—Nappa  v.  Erie  Ry.  Co.,  195  N.  Y.  176,  184;  Gallagher  v.  Newman,  190  N.  Y. 
444,  447-8;  Cashman  v.  Chase,  156  Mass.  342;  Quinlan  v.  Lackawanna 
Steel  Co.,  107  A.  D.  176,  affirmed  191  N.  Y.  329;  Finnigan  v.  N.  Y.  Con- 
tracting Co.,  194  N.  Y.  244. 

4 — Thompson  v.  Thompson,  218  U.  S.  611. 


46 

Probably  there  are  no  other  cases  which  have  created  so 
much  bitterness  as  those  of  personal  injury  in  which  the 
plaintiffs  have  been  denied  recovery  of  damages  on  the  prin- 
ciples of  "fellow  servant,"  "assumption  of  risk"  and  "con- 
tributory negligence,"  and  the  obstacles  which  have  been 
created  by  the  courts  to  prevent  the  removal  of  these  de- 
fenses for  the  employer  have  served  only  to  intensify  the 
feeling.  The  contrast  in  attitude  of  the  judges  can  not  better 
be  shown  than  by  considering  that  while  they  have  held  each 
employee  of  a  corporation  responsible  under  these  three  prin- 
ciples not  only  for  his  own  involuntary  acts  but  for  the 
physical  condition  of  the  entire  property  and  the  conduct  of 
each  of  his  fellow  workers,  they  have  repeatedly  absolved  offi- 
cials, directors  and  stockholders  from  responsibility  for  acci- 
dents, even  when  the  unsafe  condition  of  the  property  had  been 
published,  or  when  orders  had  been  issued  which  were  directly 
responsible  for  the  accidents.  It  would  hardly  be  an  exag- 
geration to  say  that  if  the  courts  had  held  officials  and  di- 
rectors to  as  great  a  degree  of  responsibility  as  employees  for 
the  condition  of  the  property  and  the  actions  of  their  agents, 
there  is  hardly  one  who  would  have  escaped  punishment  for 
criminal  negligence.  According  to  the  best  estimates,  approxi- 
mately 35,000  persons  were  killed  last  year  in  American  in- 
dustry, and  at  least  one-half  of  these  deaths  were  preventable.1 
What  would  be  the  situation  if  the  courts,  following  the  clear 
logic  of  their  own  decisions,  should  hold  the  stockholders, 
directors,  and  officials  criminally  responsible  for  eaxjh  of  the 
17,500  preventable  deaths  to  which  attention  has  time  after 
time  been  directed? 

That  the  courts,  including  even  the  highest  tribunal  of  the 
Nation,  do  allow  their  economic  bias  to  influence  them  in  hold- 
ing laws  unconstitutional  is  nowhere  more  clearly  expressed 
than  in  the  dissenting  opinion  of  Mr.  Justice  Holmes  in  the 
case  of  Lochner  v.  N.  Y.2,  wherein  the  right  of  the  Legislature 
of  New  York  to  limit  the  hours  of  work  in  bakeries  was  in- 
volved.   He  said: 

1— Industrial  Accident  Statistics,  Bui.  Whole  No.  157,  U.  S.  Bureau  of  Labor 

Statistics,  1915. 
2— Lochner  v.  N.  Y„  198  U.  S.  45. 


47 

This  case  is  decided  upon  an  economic  theory  which  a 
large  part  of  the  country  does  not  entertain.  If  it  were  a 
question  whether  I  agree  with  that  theory  [limiting  the 
consecutive  hours  of  labor  in  bakeries  which  may  be  re- 
quired of  an  employee],  I  should  desire  to  study  it  fur- 
ther and  long  before  making  up  my  mind.  But  I  do  not 
conceive  that  to  be  my  duty,  because  I  strongly  believe 
that  my  agreement  or  disagreement  has  nothing  to  do 
with  the  right  of  a  majority  to  embody  their  opinions  in 
law. 

*  *  *  Some  of  these  laws  [referring  to  several 
which  he  has  discussed]  embody  convictions  or  prejudices 
which  judges  are  likely  to  share.  Some  may  not,  but 
a  Constitution  is  not  intended  to  embody  a  particular 
economic  theory,  whether  of  paternalism  and  the  organic 
relation  of  the  citizen  to  the  State,  or  of  laissez  faire.  It  is 
made  for  people  of  fundamentally  diifering  views,  and 
the  accident  of  our  finding  certain  opinions  natural  and 
familiar  or  novel,  and  even  shocking,  ought  not  to  con- 
clude our  judgment  upon  the  question  whether  statutes 
embodying  them  conflict  with  the  Constitution  of  the 
United  States. 

This  statute  of  the  State  of  New  York,  which  had  been  sus- 
tained by  the  courts  of  New  York,  was  thus  held  unconstitu- 
tional, we  are  assured  by  the  highest  possible  authority,  on 
the  economic  theories  of  five  judges,  whose  bias  is  clearly  re- 
flected in  the  majority  opinion.  By  that  action  not  only  were 
the  bakers  of  New  York  deprived  of  all  legal  relief  from  the 
hardships  of  working  long  hours  in  underground  bakeries, 
but  the  entire  movement  for  relieving  the  condition  of  other 
workmen  in  similarly  unhealthful  occupations  throughout  the 
country  was  effectually  checked  for  a  decade.  Can  these 
judges,  the  workers  ask,  absolve  themselves  from  responsi- 
bility for  the  thousands  of  lives  which  have  been  shortened  as 
a  result  of  their  decisions,  the  ill-health  and  suffering  of  other 
thousands  who  contracted  disease  as  a  result  of  unduly  long 
exposure  to  bad  conditions  and  a  lack  of  sufficient  fresh  air 


48 

and  leisure?  The  provision  of  the  Constitution  which  was 
held  to  be  violated  by  this  act  was  the  fourteenth  amendment, 
designed  solely  to  protect  the  emancipated  negroes. 

The  wide  range  of  the  labor  laws  declared  unconstitutional 
may  be  seen  from  the  following  list,  which  includes  only  those 
cases  which  may  be  clearly  understood  from  their  titles : 


Labor  Laws  declared  Unconstitutional. 

Requiring  statement  of  cause  of  discharge.1 

Prohibiting  blacklisting.* 

Protecting  workmen  as  members  of  labor  unions.3 

Restricting  power  of  courts  to  grant  injunctions,  etc.4 

Protecting  employees  as  voters  (Federal).5 

Forbidding  public  employment  office  to  furnish  names  of 

applicants  to  employers  whose  workmen  were  on  strike.6 
Fixing  rates  of  wages  on  public  works.7 
Regulating  weighing  of  coal  at  mines  (four  States).8 
Providing  for  small  attorneys'  fees  in  successful  actions  to 

recover  wage  claims.9 


1— Wallace  v.  G.  C.  &  N.  R.  Co.,  94  Ga.  732. 

2— Wabash  R.  Co.  v.  Young,  162  Ind.  102. 

3 — Gillespie  v.  People,  188  111.  176;  Cofieeville  Brick  &  Tile  Co.  v.  Perry,  69 

Kans.  297;  State  v.  Juloto,  129  Mo.  163;  Goldfield  Consolidated  Mines  Co. 

v.  Goldfield  Miners'  Union,  159  Fed.  500;  People  v.  Marcus,  185  N.  Y.  257; 

State  v.  Kreutzberg,  114  Wis.  530;  Adair  v.  United  States,  208  U.  S.  161. 
4 — Pierce  v.  Stablemen's  Union,  156  Cal.  70;  State  v.  Shepherd,  177  Mo.  234; 

Cheadle  v.  State,  110  Ind.  301. 
5 — United  States  v.  Amsden,  10  Bissell  283. 
6— Mathews  v.  People,  202  111.  389. 
7— Street  v.  Yarney  Electrical  Supply  Co.,  160  Ind.  338. 
8 — Harding  v.  People,  160  111.  459;  In  re  Preston,  63  Ohio  St  428;   Com.  v. 

Broum,  8  Pa.  Super.  Ct  339;  In  re  House  Bill  No.  203,  21  Colo.  27. 
9 — Randolph  v.  Builders'  and  Painters'  Supply  Co.,  106  Ala.  501;   Builders' 

Supply  Depot  v.  O'Connor,  150  Cal.  265;  Davidson  v.  Jennings,  27  Colo. 

187;  Manowsky  v.  Stephan,  233  111.  409. 


49 

Fixing  the  time  of  payment  of  wages.1 

Prohibiting  use  of  "scrip."2 

Prohibiting  or  regulating  company  stores.3 

Fixing  hours  of  labor  in  private  employment.4 

Defining  liability  of  employers  for  injuries.5 

It  is  difficult  to  find  parallel  cases  to  illustrate  the  difference 
in  the  point  of  view  assumed  by  the  courts  upon  the  same  con- 
stitutional question  according  to  economic  or  social  results  of 
the  decisions  in  different  cases.  There  are  a  few  clear-cut 
cases,  however,  in  which  the  contrast  is  plainly  shown,  as  for 
example  in  the  inconsistency  between  the  decisions  in  the  Debs 
case,6  wherein  it  is  held  that  the  control  of  Congress  over 
interstate  commerce  is  so  complete  that  it  may  regulate  the 
conduct  of  the  employees  engaged  therein  to  the  extent  of  en- 
joining them  from  going  on  a  sympathetic  strike,  and  the  de- 
cision in  the  Adair  case,7  wherein  it  is  held  that  Congress  has 
so  little  power  over  the  conduct  of  those  engaged  in  interstate 
commerce  that  it  can  not  constitutionally  forbid  employers 
engaged  therein  discharging  their  employees  merely  because 
of  membership  in  a  labor  union. 

In  this  same  connection  it  is  proper  to  contrast  the  almost 
uniform  prohibition  by  the  State  and  Federal  courts  of  second- 
ary boycotts  in  labor  cases  even  to  the  extent  of  enjoining  the 
publication  of  "unfair  lists,"  with  the  decision  in  the  case  of 
Park  Company  v.  Druggists'  Association  (175  N.  Y.).    In  this 


1— Republic  Iron  &  Steel  Co.  v.  State,  160  Ind.  379;   Braceville  Coal  Co.  v. 

People,  147  111.  66;  Johnson  v.  Goodyear  Mining  Co.,  127  Cal.  4. 
2 — Oodcharles  v.  Wigeman,  113  Pa.   St.  431;   Jordan  v.  State,  51  Texas  Cr. 

App.  531. 
2—Frorer  v.  People,  141  111.  171;  State  v.  Fire  Creek  Coal  &  Coke  Co.,  33  W. 

Va.  188. 
4 — In  re  Morgan,  26  Colo.  415;  Lochner  v.  New  York,  198  U.  S.  45;  Low  v. 

Rees  Printing  Co.,  41  Nebr.  127;  Ritchie  v.  People,  155  111.  98;  People  v. 

Williams,  189  N.  Y.  131. 
5— Ballard  v.  Mississippi  Cotton  Oil  Co.,  81  Miss.  507;  Baltimore  &  0.  S.  W. 

R.  Co.  v.  Read,  158  Ind.  25. 
6—158  U.  S.  564. 
7—208  U.  S.   161. 


50 

case  the  Park  Company  charged  that  the  Druggists '  Associa- 
tion fixed  prices  of  proprietary  medicines ;  that  they  refused 
to  sell  to  anyone  who  did  not  abide  by  the  prices  thus  fixed; 
that  the  druggists  combined  in  this  Association  refused  to  sell 
to  the  Park  Company;  and  that  they  used  spies  to  ascertain 
with  whom  the  Park  Company  did  business  with  intent  to 
compel  such  customers  to  cease  doing  business  with  the  Park 
Company.  The  facts  were  admitted  on  demurrer,  but  the  court 
refused  to  issue  an  injunction,  holding  that  the  boycott  was 
caused  by  plaintiff  himself  and  could  be  removed  whenever  he 
saw  fit  to  abide  by  the  Association's  rules;  and,  further,  that 
there  was  no  conspiracy.  If  the  same  line  of  reasoning  were 
followed  in  labor  cases,  it  is  difficult  to  imagine  any  kind  of 
boycott  which  would  be  illegal. 

Finally,  reference  should  be  made  to  the  history  of  the  fight 
for  the  enactment  of  eight-hour  legislation  in  Colorado,  which 
illustrates  the  grounds  upon  which  the  workers  not  only  of 
that  State  but  throughout  the  Nation  distrust  legislatures, 
courts,  and  executive  officials. 

Although  the  eight-hour  day  was  established  in  Colorado 
gold  mines  by  agreement  among  the  operators  after  the  Crip- 
ple Creek  strike  of  1894,  in  the  coal-mining  industry  a  twenty- 
years  struggle  followed  the  miners'  first  attempt  at  legislation. 

The  eight-hour  bill  presented  to  the  General  Assembly  in 
1895,  though  supported  by  the  Western  Federation  of  Miners, 
the  United  Mine  Workers  of  America,  and  labor  organizations 
in  general,  was,  upon  reference  to  the  Supreme  Court  for  an 
advance  opinion,  reported  as  unconstitutional,  and  failed  of 
enactment. 

A  bill  brought  successfully  to  enactment  in  1899,  and  which 
was  substantially  a  copy  of  the  Utah  law  upheld  by  State  and 
Federal  Supreme  Courts,  was  declared  by  the  Colorado  Su- 
preme Court  to  be  unconstitutional.1 

In  1901  the  people  adopted  by  an  overwhelming  vote  an 
amendment  to  the  Constitution  which  provided  for  eight-hour 

1— In  re  Morgan,  26  Colo.  415. 


51 

legislation.  This  was  followed  by  the  introduction  in  the  next 
General  Assembly  (1903)  of  several  bills,  and  by  the  inaugura- 
tion of  active  opposition  thereto  on  the  part  of  corporations. 
No  fewer  than  eleven  anonymous  bulletins  were  attributed  to 
one  officer  of  a  smelting  company. 

On  account  of  disagreements  in  conference,  none  of  the  sev- 
eral bills  passed ;  and  so  great  was  the  public  outcry  that  at  the 
extra  session  in  July,  1903,  each  House  passed  resolutions 
blaming  the  other  for  the  failure. 

In  the  session  of  1904-5  a  bill  substantially  the  same  as  the 
present  law,  and  favored  by  all  political  parties,  was  so 
amended  by  Mr.  Guggenheim  as  to  be  "absolutely  worthless." 
It  remained  on  the  statute  books,  a  dead  letter,  until  1911. 

In  1911,  House  Bill  46  was  passed.  The  operators  succeeded 
in  having  it  submitted  to  a  referendum  vote,  and  at  the  last 
moment  they  initiated  a  smelterman  's  eight-hour  bill,  the  two 
came  up  on  the  same  ballot,  and  in  the  succeeding  confusion 
both  were  adopted  by  the  people,  because  of  their  genuine 
interest  in  the  passage  of  an  eight-hour  law. 

The  legislature  of  1913  repealed  both  the  laws  so  enacted  in 
1911,  and  reenacted  House  Bill  46,  the  present  law.  By  a  de- 
cision of  the  Supreme  Court,  allowing  a  "safety  clutch,"  this 
law  may  not  be  referred. 

The  essential  injustice  and  stupidity  of  this  long  fight  of 
the  employers  against  eight-hour  legislation  is  strikingly 
shown  by  a  letter  from  Mr.  L.  M.  Bowers,  Chairman  of  the 
Board  of  Directors  of  the  Colorado  Fuel  &  Iron  Co.,  to  Mr. 
J.  D.  Rockefeller,  Jr.,  stating  that  after  they  saw  that  such 
legislation  was  inevitable,  they  tried  out  the  eight-hour  day 
in  their  mines  and  found  that  it  was  economically  profitable. 
The  Colorado  Fuel  &  Iron  Co.  thereby  is  shown  to  have  stub- 
bornly resisted  by  every  conceivable  device,  for  a  period  of 
twenty  years,  a  just  law  which  was  not  only  necessary  for  the 
health  and  welfare  of  its  12,000  miners  but  was  actually  pro- 
fitable for  the  company  itself. 

The  reason  for  the  effectiveness  of  the  opposition  of  the 
Colorado  Fuel  &  Iron  Co.  is  also  shown  in  the  letter  quoted  on 


52 

page  43  from  Mr.  Bowers  to  the  secretary  of  Mr.  Rockefeller, 
describing  the  complete  and  corrupt  control  which  the  Com- 
pany exercised  over  the  State  Government  during  this  period. 

Third,  it  is  alleged  by  the  workers  that  in  the  administration 
of  law,  both  common  and  statute,  there  is  discrimination  by  the 
courts  against  the  poor  and  in  favor  of  the  wealthy  and  power- 
ful. It  is  further  stated  that  this  discrimination  arises  not 
only  from  the  economic  disabilities  of  the  poor,  which  render 
them  unable  to  employ  equally  skillful  lawyers,  to  endure  the 
law's  delay,  and  to  stand  the  expense  of  repeated  appeals,  but 
out  of  an  actual  bias  on  the  part  of  the  judges  in  favor  of  the 
wealthy  and  influential.  It  should  arouse  great  concern  if 
it  be  true  that  the  courts  do  not  resolve  their  doubts  in  favor 
of  the  poor  and  humble ;  how  much  graver  then  is  the  injustice 
if  the  judges  do  in  fact  lean  toward  the  rich  and  mighty? 

To  establish  this  claim  by  the  presentation  of  a  sufficient 
number  of  cases  wrould  be  a  tedious  task.  Many  such  have  been 
presented  to  the  Commission,  but  can  not  be  considered  fully 
here.  Instead,  it  would  seem  that  in  such  cases  we  may  safely 
rely  upon  the  uncontradicted  opinion  of  weighty  authorities 
whose  position  removes  from  them  any  suspicion  of  bias. 

Ex-President  William  H.  Taf t  has  said : 

We  must  make  it  so  that  the  poor  man  will  have  as 
nearly  as  possible  an  equal  opportunity  in  litigating  as  the 
rich  man;  and  under  present  conditions,  ashamed  as  we 
may  be  of  it,  this  is  not  the  fact. 

Prof.  Henry  R.  Seager,  of  Columbia  University,  testified 
before  the  Commission: 

I  don't  see  how  any  fair-minded  person  can  question  but 
what  our  judges  have  shown  a  decided  bias  in  favor  of 
the  employers.  I  would  not  be  inclined  to  ascribe  this  so 
much  to  a  class  bias,  although  I  think  this  is  a  factor,  as 
to  the  antecedent  training  of  judges.  Under  our  legal 
system  the  principal  task  of  the  lawyer  is  to  protect  prop- 
erty rights,  and  the  property  rights  have  come  to  be  con- 
centrated more  and  more  into  the  hands  of  corporations, 


53 

so  that  the  successful  lawyer  of  today,  in  a  great  majority 
of  cases,  is  the  corporation  lawyer.  His  business  is  to  pro- 
tect the  rights  of  employers  and  corporations.  It  is  from 
the  ranks  of  successful  lawyers,  for  the  most  part,  that  our 
judges  are  selected,  and  from  that  results  inevitably  a  cer- 
tain angle  on  the  part  of  a  majority  of  our  judges. 

The  bias  of  the  courts  is  nowhere  more  clearly  shown  than 
in  cases  involving  persons  and  organizations  with  whose  eco- 
nomic and  social  views  the  court  does  not  agree.  An  interest- 
ing example  may  be  cited  in  the  case  of  Warren  v.  U.  S.,  183 
Fed.  718,  where  the  editor  of  Appeal  to  Reason,  Fred  D.  War- 
ren, was  sentenced  by  the  Federal  District  Court  to  six  months' 
imprisonment  and  a  fine  of  $1500  for  the  circulation  through 
the  mails  of  matter  offering  a  reward  to  anyone  who  would 
kidnap  a  certain  governor  for  whom  extradition  had  been 
refused.1 

The  sentence  was  commuted  by  President  Taft,  against 
the  protest  of  Warren,  to  a  fine  of  $100  to  be  collected  in  a 
civil  suit.  In  commenting  on  the  sentence,  President  Taft  is 
reported  to  have  said : 

The  District  Court  evidently  looked  beyond  the  record 
of  the  evidence  in  this  case  and  found  that  Warren  was 
the  editor  and  publisher  of  a  newspaper  engaged  in  a 
crusade  against  society  and  government. 

Moreover,  this  is  not  a  prosecution  for  criminal  libel; 
it  is  a  prosecution  for  what  at  best  is  the  violation  of  a 
regulation  as  to  the  use  of  the  mails.  To  visit  such  an 
offense  with  a  severe  punishment  is  likely  to  appear  to 
the  public  to  be  an  effort  to  punish  the  defendant  for 
something  that  could  not  be  charged  in  the  indictment. 

This  obviously  was  not  intended  as  a  reflection  upon  the 
court,  but  the  attitude  of  a  large  part  of  the  workers  is  that 
if  President  Taft  was  justified  in  making  such  an  assertion  it 

'  '     •  ^B 

1 — It  was  alleged  by  Warren  that  this  was  done  to  call  attention  to  the  gross 
discrimination  in  the  case  of  Haywood  and  Moyer,  who  were  kidnaped 
and  transported  from  one  State  to  another. 


54 

was  a  case  demanding  impeachment  of  the  judges  involved 
rather  than  a  commutation  of  sentence  for  Warren. 

Fourth,  it  is  charged  by  the  representatives  of  labor  not 
only  that  courts  have  neglected  or  refused  to  protect  workers 
in  the  rights  guaranteed  by  the  Constitution  of  the  United 
States  and  of  the  several  States,  but  that  sections  of  the  Con- 
stitution framed  primarily  to  protect  human  rights  have  been 
perverted  to  protect  property  rights  only  and  to  deprive  work- 
ers of  the  protection  of  rights  secured  to  them  by  statutes. 

First,  with  regard  to  the  Federal  courts,  it  is  startling  and 
alarming  to  citizens  generally,  and  particularly  to  workers, 
to  learn  that  the  consensus  of  Federal- decisions  is  to  the  effect 
that  the  sections  of  the  Constitution  defining  the  rights  of 
citizens  to  trial  by  jury,  security  from  unwarranted  arrest 
and  search,  free  speech,  free  assembly,  writ  of  habeas  corpus, 
bearing  of  arms,  and  protection  from  excessive  bail  and 
cruel  and  unusual  punishments,  apply  only  to  Federal  juris- 
diction and  in  reality  protect  the  citizen  only  against  the  action 
of  the  Federal  Government.  The  only  sections  protecting 
the  personal  rights  of  citizens  under  ordinary  circumstances 
are  the  thirteenth  amendment,  prohibiting  involuntary  servi- 
tude, the  fifteenth,  protecting  the  right  to  vote,  and  the  four- 
teenth, providing  that  "No  State  shall  make  or  enforce  any 
law  which  shall  abridge  the  privileges  or  immunities  of  citi- 
zens of  the  United  States;  nor  shall  any  State  deprive  any 
person  of  life,  liberty,  or  property,  without  due  process  of 
law,  nor  deny  any  person  within  its  jurisdiction  the  equal 
protection  of  the  laws." 

"We  are,  however,  informed  by  counsel  who  has  examined 
the  cases  involved,  that  the  fourteenth  amendment  has  had 
no  appreciable  effect  in  protecting  personal  rights.  Accord- 
ing to  the  existing  decisions,  the  due-process  clause  does  not 
guarantee  the  right  of  trial  by  jury,1  nor  does  it  necessitate 
indictment  by  grand  juries,2  nor  has  it  restrained  arbitrary 


1— Maxwell  v.  Dow,  176  U.  S.  581;  Walker  v.  Sauvinet,  92  U.  S.  90. 
2—Hurtado  v.  California,  119  U.  S.  516. 


55 

arrests  and  imprisonment  on  the  part  of  State  Governments 
when  men  are  kidnaped  in  one  State  and  carried  to  another.1 

Up  to  1911  the  United  States  Supreme  Court  intervened  in 
55  cases  in  which  the  fourteenth  amendment  was  invoked.  In 
39  of  these  cases  private  corporations  were  the  principal  par- 
ties. Thirty-two  statutes  were  affected  by  these  decisions,  and 
in  only  three,  concerning  the  civil  rights  of  negroes,  were  the 
personal  rights  of  individual  citizens  involved.  With  the  ex- 
ceptions involving  the  rights  of  negroes  in  jury  cases  (e.  g., 
Strauder  v.  W.  Va.,  100  U.  S.  303),  the  fourteenth  amendment 
has  not  acted  to  secure  or  protect  personal  rights  from  State 
encroachment,2  but  only  to  prevent  encroachment  on  property 
rights.3  In  all  the  other  numerous  cases  in  which  the  four- 
teenth amendment  was  invoked  to  protect  personal  rights,  the 
attempt  failed. 

On  the  other  hand  there  is  abundant  evidence  of  the  great 
protection  which  it  affords  corporations  and  other  forms  of  or- 
ganized capital.  On  that  point  we  may  quote  the  statements  of 
Mr.  C.  W.  Collins,  of  the  Alabama  Bar,  who  analyzed  the  de- 
cisions of  the  United  States  Supreme  Court  through  the 
October,  1910,  term:4 

Private  corporations  are  using  it  as  a  means  to  prevent 
the  enforcement  of  State  laws.  Since  1891  a  majority  of 
cases  under  the  Amendment  have  involved  a  corporation 
as  the  principal  party.  *  *  *  The  increase  of  this  kind 
of  litigation  runs  parallel  to  the  rise  of  the  trust  move- 
ment in  America.  At  the  1909-10  term  of  the  Court,  out 
of  a  total  of  twenty-six   opinions   rendered   under   the 


1— Re  Pettibone,  12  Idaho  264;  203  U.  S.  192;  re  Moyer,  35  Colo.  159;  140 
F.  R.  870;  203  U.  S.  221;  re  Boyle,  6  Idaho  609. 

2 — See  for  illustration:  Virginia  v.  Rives,  100  U.  S.  313;  Plessy  v.  Ferguson, 
163  U.  S.  537;  Twining  v.  New  Jersey,  211  U.  S.  78;  Brown  v.  New 
Jersey,  175  U.  S.  172. 

3— See  for  illustration:  C.  M.  <t-  St.  P.  Ry.  v.  Minnesota,  134  U.  S.  418;  Cot- 
ting  v.  K.  C.  Stockyards  Co.,  183  U.  S.  79;  O.  C.  <£  S.  F.  Ry.  v.  Ellis,  168 
U.  S.  150. 

4 — The   Fourteenth  Amendment  and   the   States,   C.   W.   Collins. 


N 


56 

Amendment,  twenty  involved  a  corporation  as  the  prin- 
cipal party. 

*  *  *  The  Fourteenth  Amendment  is  the  easiest  of 
all  constitutional  measures  to  invoke.  In  a  country  where 
economic  activity  is  so  intense  and  time  so  vital  an  ele- 
ment, it  has  been  grasped  as  a  sure  measure  of  delay, 
with  always  the  possibility  of  obtaining  affirmative  re- 
lief. The  Amendment,  though  intended  primarily  as  a 
protection  to  the  negro  race,  has  in  these  latter  days  be- 
come a  constitutional  guarantee  to  the  corporations  that 
no  State  action  toward  them  can  become  effective  until 
after  years  of  litigation  through  the  State  and  Federal 
courts  to  the  Supreme  Court  of  the  United  States.  The 
course  of  the  Amendment  is  running  away  from  its  orig- 
inally intended  channel,     (p.  145) 

The  Fourteenth  Amendment,  although  a  humanitarian 
measure  in  origin  and  purpose,  has  been  within  recent 
years  practically  appropriated  by  the  corporations.  It 
was  aimed  at  restraining  and  checking  the  powers  of 
wealth  and  privilege.  It  was  to  be  a  charter  of  liberty 
for  human  rights  against  property  rights.  The  trans- 
formation has  been  rapid  and  complete.  It  operates  today 
to  protect  the  rights  of  property  to  the  detriment  of  the 
rights  of  man.  It  has  become  the  Magna  Charta  of  ac- 
cumulated and  organized  capital,    (p.  137) 

It  is  thus  quite  clear  that  the  fourteenth  amendment  not 
only  has  failed  to  operate  to  protect  personal  rights  but  has 
operated  almost  wholly  for  the  protection  of  the  property 
rights  of  corporations.  These  facts  taken  in  conjunction 
with  the  many  decisions,  such  as  the  Lochner  case,1  in  which 
the  fourteenth  amendment  has  been  invoked  to  annul  statutes 
designed  to  better  conditions  of  life  and  work,  must  constitute 
just  ground  for  grave  concern  not  only  to  the  workers  but  to 
every  citizen  who  values  his  liberty. 

With  the  "bills  of  rights"  contained  in  the  Constitutions  of 

1— Lochner  v.  N.  Y.,  198  U.  S.  45. 


57 

the  several  States,  the  situation,  as  far  as  the  workers  are  con- 
cerned, is  somewhat  different,  since  in  many  jurisdictions 
these  have  been  used  upon  numerous  occasions  to  afford  sub- 
stantial protection  to  them  in  their  personal  rights.  The 
workers  call  attention  particularly,  however,  to  the  long  list 
of  statutes,  city  ordinances  and  military  orders  abridging 
freedom  of  speech  and  press,  which  not  only  have  not  been 
interfered  with  by  the  courts  but  whenever  tested  have  al- 
most uniformly  been  upheld  by  the  State  and  Federal  courts.1 
They  point  also  to  the  grave  injuries  done  to  workers  individ- 
ually and  collectively  by  the  thousands  of  arrests  which  have 
been  made  without  just  cause  in  labor  disputes,  without  relief 
from  either  the  courts  or  the  executive;  to  the  denial  of  the 
right  to  the  writ  of  habeas  corpus  upon  numerous  occasions ; 
to  the  fact  that  where,  as  for  example  in  Los  Angeles,  San 
Diego  and  Fresno  (Cal.),  Spokane  (Wash.),  Minot  (N.  D.), 
Paterson  (N.  J.),  Little  Falls  (N.  Y.),  Lawrence  (Mass.), 
Idaho,  Colorado,  and  West  Virginia,  workers  have  been  griev- 
ously injured,  brutally  treated,  or  interfered  with  in  the  pur- 
suit of  their  guaranteed  rights  by  other  classes  of  citizens 
or  by  officials,  the  courts  have  not  interfered  and  the  per- 
petrators have  gone  unpunished. 

On  the  general  question  of  martial  law  and  habeas  corpus 
a  member  of  the  staff  has  made  an  elaborate  comparison 
of  the  cases  arising  from  nonlabor  disturbances  with  the  cases 
arising  from  labor  disturbances.  It  is  not  necessary,  and 
would  require  too  much  space,  to  recite  these  cases  in  full, 
but  among  the  former  may  be  mentioned  the  Milligan  case,  and 
other  cases  arising  in  the  State  courts  of  Indiana,  Illinois, 
Kentucky,  North  Carolina,  and  Wisconsin2  (all  during  or  im- 
mediately following  the  Civil  War),  and  three  cases  in  the 
courts  of  Kentucky,  Ohio,  and  Oklahoma  since  that  time;3 

l—Fox  v.  Washington,  236  U.  S.  273;  Fitts  v.  Atlanta,  121  Ga.  267;  Ex  parte 

Thomas,  102  Pacific  19. 
2 — In  re  Milligan   4  Wallace    (U.   S.)    2;    Skeen  v.  Monkeimer,   21   Ind.   1; 

Johnson  v.  Jones,  44   111.  142;    Corbin  v.  Marsh,  2  Dur.   193;    ex  parte 

Moore,  64  N.  C.  802;  in  re  Kemp,  16  Wis.  382. 
3— Franks  v.  Smith,  142  Ky.  232;  Ohio  v.  Coit,  8  Ohio  62;  Fluke  v.  Canton, 

31  Okla.  718. 


58 

among  the  latter,  i.  e.,  those  arising  from  labor  disturbances, 
are  included  the  cases  from  Colorado,  Idaho,  Montana,  Penn- 
sylvania, and  West  Virginia.1  The  results  of  such  comparison 
are  summarized  in  part  as  follows : 

Although  uniformly  held  that  the  writ  of  habeas  corpus 
can  only  be  suspended  by  the  legislature,  in  these  labor 
disturbances  the  executive  has  in  fact  suspended  or  dis- 
regarded the  writ.  In  the  labor  cases  the  judiciary  either 
disregards  the  fact  that  the  writ  has  been  suspended  by 
the  executive  or  evades  the  issue.  In  nonlabor  cases  the 
courts  have  protested  emphatically  when  the  executive 
attempted  to  interfere  with  the  writ  of  habeas  corpus. 

In  many  instances  in  which  the  military  has  been  in 
active  operation  because  of  nonlabor  disturbances,  the 
judiciary  has  almost  without  exception  protested  against 
the  exercise  of  any  arbitrary  power  and  has  almost  uni- 
formly attempted  to  limit  that  power. 

In  cases  arising  from  labor  agitations,  the  judiciary 
has  uniformly  upheld  the  power  exercised  by  the  military 
and  in  no  case  has  there  been  any  protest  against  the 
use  of  such  power  or  any  attempt  to  curtail  it,  except  in 
Montana,  where  the  conviction  of  a  civilian  by  military 
commission  was  annulled. 

Finally,  it  is  impossible  to  imagine  a  more  complete  mockery 
of  justice  and  travesty  upon  every  conception  of  fair  dealing 
than  the  innumerable  decisions  holding  unconstitutional  wise 
and  salutary  laws  for  the  protection  of  workers,  upon  the 
ground  that  they  violate  the  right  of  contract,  even  while  the 
workers,  whose  rights  are  supposed  to  be  affected,  clamor  for 
the  maintenance  of  the  statute.  The  appeal  for  the  protec- 
tion of  the  workers'  rights  in  such  cases  comes  invariably 
from  the  employers,  and  is  urged  against  the  protest  of  the 
workers,  yet  in  almost  unbroken  succession  the  judges  sol- 

1 — In  re  Moyer,  35  Colo.  159;  in  re  Boyle,  6  Idaho  609;  in  re  McDonald,  49' 
Mont  455;  Com.  v.  Shortall,  206  Pa.  165;  Mays  and  Nance  v.  Brown,  71 
W.  Va.  519;  ex  parte  Jones,  71  W.  Va.  567. 


59 

emnly  nullify  the  wisest  acts  of  legislatures  on  just  such  spe- 
cious, self-serving  pleas.  There  are  notable  cases  in  which 
the  judges  have  unmasked  the  munmiery,  as,  for  example,  in 
H olden  v.  Hardy,1  where  it  was  said : 

Although  the  prosecution  in  this  case  was  against  the 
employer  of  labor,  who,  apparently,  under  the  statute, 
is  the  only  one  liable,  his  defense  is  not  so  much  that 
his  right  to  contract  has  been  infringed  upon,  but  that 
the  act  works  a  peculiar  hardship  to  his  employees,  whose 
right  to  labor  as  long  as  they  please  is  alleged  to  be 
thereby  violated.  The  argument  would  certainly  come 
with  better  grace  and  greater  cogency  from  the  latter 
class. 

There  appear  to  be  no  reported  cases  in  which  the  workers 
have  urged  that  their  rights  are  violated  by  such  restrictive 
legislation,  which  in  fact  invariably  originates  with  them ;  but 
the  courts  continue  to  hand  down  decisions  "protecting  the 
sacred  right  of  contract  of  the  worker,"  when  the  only  per- 
son benefited  is  the  employer,  who  is  thus  able  to  "turn  the 
very  Constitution  itself  into  an  instrument  of  inequality." 

This  entire  situation  is  fraught  with  such  grave  dangers 
not  only  to  the  workers  but  to  all  citizens  who  value  their 
individual  liberty,  that  the  Nation  can  not  be  entirely  secure 
until  those  fundamental  rights  are  affirmatively  guaranteed 
to  every  citizen  of  the  United  States  by  the  Federal  Govern- 
ment. It  is  therefore  earnestly  recommended  that  Congress 
forthwith  initiate  an  amendment  to  the  Constitution  securing 
these  rights  against  encroachment  by  Federal,  State  or  local 
governments  or  by  private  persons  and  corporations. 

Fifth,  it  is  charged  that  the  ordinary  legal  machinery  pro- 
vides no  adequate  means  whereby  laborers  and  other  poor 
men  can  secure  redress  for  wrongs  inflicted  upon  them  through 
the  nonpayment  of  wages,  through  overcharges  at  company 
stores,  through  exorbitant  hospital  and  other  fees,  fines  and 

1—169  u.  S.  366. 


60 

deductions,  through  fraud  on  the  part  of  private  employment 
offices,  loan  offices  and  installment  houses,  and  through  the 
"grafting"  of  foremen  and  superintendents.  The  losses  to 
wage  earners  from  these  sources  are  stated  to  amount  each 
year  to  millions  of  dollars  and  to  work  untold  hardship  on  a 
class  of  men  who  can  ill  afford  to  lose  even  a  penny  of  their 
hard-won  earnings. 

These  charges  were  thoroughly  investigated  in  all  parts  of 
the  country  by  an  experienced  member  of  the  Commission's 
staff.  * 

He  cites,  for  example,  that  in  California,  where  the  situa- 
tion has  been  more  completely  uncovered  than  elsewhere  and 
where  remedies  are  beginning  to  be  applied,  during  the  year 
ending  June,  1914,  9621  claims  were  presented  to  the  Com- 
missioner of  Labor  alone.  Of  these,  7330  were  for  nonpay- 
ment of  wages,  of  which  4904  were  successfully  settled  and 
$110,912  of  unpaid  wages  was  collected.  This  is  believed  to 
have  been  only  a  small  proportion  of  the  total  claims  of 
laborers  throughout  the  State,  inasmuch  as  the  number  of 
claims  was  growing  rapidly  as  the  work  of  the  Bureau  be- 
came better  known,  and  because,  during  a  period  of  only  ten 
months,  over  2200  claims  were  presented  to  the  State  Com- 
mission on  Immigration  and  Housing.  The  work  of  handling 
these  claims  and  making  its  existence  known  to  laborers 
throughout  the  State  was  just  getting  well  under  way,  although 
with  a  small  appropriation  and  inadequate  force,  when  the  col- 
lection of  wage  claims  was  suddenly  checked  by  a  decision  of 
the  State  Court  of  Appeals1  that  the  Payment-of- Wages  Law 
was  unconstitutional  on  the  ground  that  since  it  provided  for 
fine  or  imprisonment  where  the  wages  of  laborers  were  il- 
legally retained,  it  was  in  effect  a  provision  for  imprisonment 
for  debt. 

The  investigation  in  other  States  revealed  equally  bad  or 
worse  conditions,  while  in  all  except  a  few  no  efficient  means 
existed  by  which  these  claims  could  be  prosecuted.  In  conclu- 
sion our  investigator  reported: 

1— November  23,  1914. 


61 

a.  The  existing  labor  and  life  conditions  of  common  labor- 
ers in  this  country  produce  immense  numbers  of  justified  labor 
complaints  and  claims,  involving  not  only  great  sums  of  money 
in  the  aggregate  but  untold  personal  hardship  and  suffering. 

b.  The  existing  public  and  private  legal  institutions  are 
utterly  inadequate  to  secure  justice  to  the  laborers  in  the  mat- 
ter of  these  complaints  and  claims. 

c.  This  situation  has  already  created  in  the  laborers  dis- 
trust of  the  Government,  of  employers,  and  of  the  well-to-do 
classes  generally,  and  is  one  of  the  contributory  causes  of  the 
existing  industrial  unrest. 

The  measures  recommended,  which  have  to  do  largely  with 
State  and  local  administrations,  are  discussed  on  pages  133-4. 
It  is  suggested,  however,  that  the  Commission  recommend 
to  Congress  that,  inasmuch  as  the  immigrant  laborers,  who 
suffer  most  largely  from  these  injustices,  are  ethically  and 
legally  wards  of  the  Nation  until  they  become  citizens,  the 
Bureau  of  Immigration  of  the  Federal  Department  of  Labor 
should  be  given  the  authority  and  necessary  appropriations 
to  establish,  wherever  it  may  seem  necessary,  in  connection 
with  its  existing  offices  in  all  parts  of  the  country,  legal  aid 
divisions  which  would  freely  and  aggressively  prosecute  these 
claims  and  complaints  on  behalf  of  the  immigrant  laborers, 
and,  if  there  are  no  constitutional  or  statutory  barriers,  on 
behalf  also  of  American  citizens. 

Sixth,  it  is  charged  by  the  workers  that  the  courts,  by  the 
unwarranted  extension  of  their  powers  in  the  issuance  of  in- 
junctions, have  not  only  grievously  injured  the  workers  in- 
dividually and  collectively  upon  innumerable  occasions,  but 
have,  by  the  contempt  procedure  consequent  upon  disobedience 
to  such  injunctions,  deprived  the  workers  of  the  right,  funda- 
mental to  anglo-Saxon  institutions,  to  be  tried  by  jury. 

This  charge  is  not  limited  to  members  of  trade  unions,  nor 
to  workers,  but  is  voiced  also  by  many  who  have  no  reason 
for  partisanship.  For  example,  Mr.  S.  S.  Gregory,  former 
president  of  the  American  Bar  Association,  testified  before 
the  Commission: 


62 

These  injunctions  are  based  upon  the  theory  that  the 
man  carrying  on  a  business  has  a  certain  sort  of  prop- 
erty right  in  the  good  will  or  the  successful  conduct  of 
that  business ;  and  that  when  several  hundred  or  several 
thousand  excited  men  gather  around  his  premises  where 
he  carries  his  business  on,  and  threaten  everybody  that 
comes  in  there  to  work,  and  possibly  use  violence,  that 
that  is  such  an  unlawful  interference  with  property  right 
as  may  be  the  subject  of  protection  in  equity.  And 
that  view  of  the  law  has  been  sustained  by  the  courts  of 
practically  all  the  States. 

But  the  great  difficulty  about  this  was  this,  that  having 
enjoined  defendants,  namely,  striking  workmen,  perhaps 
from  unlawful  interference  with  the  business  of  the  em- 
ployer, where  that  unlawful  interference  consisted  in  an 
attack  or  an  assault  and  battery  upon  another  man,  to 
wit,  perhaps  a  strikebreaker  so-called,  or  one  who  was 
hired  to  take  the  place  of  one  of  the  striking  workmen, 
that  thereafter  the  judge  who  had  ordered  the  injunction 
and  whose  authority  had  been  thus  defied,  was  permitted 
to  put  the  person  charged  with  the  breach  of  that  in- 
junction upon  trial  upon  a  charge  of  contempt,  really  for 
having  committed  an  unlawful  and  criminal  act. 

Now  the  Constitution  has  thrown  around  the  prosecu- 
tion of  criminals  (the  Constitutions  State  and  Federal) 
a  number  of  securities.  They  are  entitled  to  trial  by 
jury;  they  are  entitled  to  be  confronted  by  the  witnesses 
who  are  to  testify  against  them;  they  are  entitled  to  be 
heard  by  counsel. 

But  none  of  those  guaranties  except  perhaps  the  right 
to  be  heard  by  counsel  is  secured  in  contempt  proceed- 
ings; and  the  obvious  wisdom  of  permitting  twelve  men 
drawn  from  the  body  of  the  people  to  pass  on  questions 
of  fact — men  who  are  supposed  to  be  prejudiced  neither 
for  nor  against  the  parties,  who  know  nothing  about  the 
case  until  they  are  sworn  in  the  jury  box,  has  so  far  com- 
mended itself  to  the  wisdom  of  legislators  and  jurists  to 
such  a  degree  that  it  has  become  a  permanent  feature  of 


63 

our  jurisprudence ;  and  to  provide  that  the  court  may  pro- 
ceed against  parties  for  contempt,  where  the  conduct 
charged  against  them  is  criminal,  is  really  an  evasion  of 
the  constitutional  guaranties  and  a  plain  attempt  to  com- 
mit to  equity  jurisdiction  over  matters  which  it  has  been 
decided  over  and  over  again  by  all  the  courts  that  it 
has  no  jurisdiction  with  respect  to,  namely,  the  admin- 
istration of  the  criminal  law. 

For  instance,  I  might  receive,  as  I  leave  the  room  of 
this  tribunal  today,  a  threatening  letter  from  somebody 
saving  they  were  going  to  kill  me  for  something  I  had 
said,  or  had  not  said,  before  the  Commission.  Now,  that 
involves  personal  loss  possibly  to  my  wife  or  those  de- 
pendent upon  me;  but  no  court  of  equity  would  listen 
for  a  moment  to  a  bill  I  should  file  saying  "AB"  or  some 
other  blackhand  gentleman  had  threatened  to  kill  me,  or 
if  filed  by  anybody  dependent  upon  me,  and  therefore 
there  should  be  an  injunction  to  prevent  him  from  killing 
me.  That  would  be  an  absurdity — a  legal  absurdity; 
and  none  the  less  is  it  so  where  a  man  is  enjoined  from 
committing  acts  of  violence  in  a  strike  to  try  him  for 
contempt,  without  a  trial  by  jury.  And  that  has  been 
an  injustice  that  has  rankled  in  the  minds  of  everybody 
that  has  been  a  victim  of  it,  and  justly  so. 

Sir  Charles  Napier  says,  "People  talk  about  agitators, 
but  the  only  real  ■  agitator  is  injustice ;  and  the  only 
way  is  to  correct  the  injustice  and  allay  the  agitation." 

Judge  Walter  Clark,  Chief  Justice  of  the  Supreme  Court 
of  North  Carolina,  also  testified  before  the  Commission  as 
follows : 

Chairman  Walsh.  Have  you  studied  the  effect  of  the 
use  of  injunctions  in  labor  disputes  generally  in  the 
United  States,  as  a  student  of  economics  and  the  law? 

Judge  Clark.  I  do  not  think  they  can  be  justified,  sir, 
*  *  *  [Their  effect]  has  been,  of  course,  to  irritate  the 
men,  because  they  feel  that  in  an  anglo-Saxon  community 
every  man  has  a  right  to  a  trial  by  jury  and  that  to 


64 

take  him  up  and  compel  him  to  be  tried  by  a  judge,  is 
not  in  accordance  with  the  principles  of  equality,  liberty, 
and  justice. 

Chairman  Walsh.  Do  you  think  that  has  been  one  of 
the  causes  of  social  unrest  in  the  United  States! 

Judge  Clark.  Yes,  sir,  and  undoubtedly  will  be  more 
so,  unless  it  is  remedied. 

It  is  not  within  the  province  of  the  Commission  to  attempt 
to  decide  the  question  of  whether  or  not  the  issuance  of  such 
injunctions  is  an  unwarranted  extension  upon  the  part  of  the 
courts;  but  the  weighty  opinions  cited  above  are  very  im- 
pressive and  are  convincing  that  the  workers  have  great  rea- 
son for  their  attitude.  It  is  known,  however,  from  the  evi- 
dence of  witnesses  and  from  the  information  collected  by  the 
staff,  that  such  injunctions  have  in  many  cases  inflicted  griev- 
ous injury  upon  workmen  engaged  in  disputes  with  their  em- 
ployers, and  that  their  interests  have  been  seriously  prejudiced 
by  the  denial  of  jury  trial,  which  every  criminal  is  afforded, 
and  by  trial  before  the  judge  against  whom  the  contempt  was 
alleged. 

It  is  felt  to  be  a  duty,  therefore,  to  register  a  solemn  protest 
against  this  condition,  being  convinced  of  its  injustice  not 
only  by  reason  of  the  evil  effects  which  have  resulted  from 
this  procedure,  but  by  virtue  of  a  conviction  that  no  person's 
liberty  can  safely  be  decided  by  any  one  man,  particularly 
when  that  man  is  the  object  of  the  alleged  contempt. 

The  Clayton  Act  undoubtedly  contains  many  features  which 
will  relieve  this  situation  as  far  as  the  Federal  courts  are  con- 
cerned, but  it  seems  clear  that  it  does  not  contain  anything 
like  a  complete  solution  of  the  existing  injustices,  even  for  the 
limited  field  of  Federal  jurisdiction. 

Seventh,  it  is  charged  by  the  representatives  of  labor  that 
laws  designed  for  the  protection  of  labor  in  workshops  and 
mines  and  on  railroads,  are  not  effectively  enforced,  except 
in  a  few  States.  This  is  a  matter  of  considerable  moment  to 
labor,  but  it  is,  after  all,  regarded  by  the  workers,  since  it  con- 


65 

cerns  chiefly  only  their  safety  and  comfort,  as  ranking  far  be- 
low the  other  matters  discussed,  which  involve  primarily  their 
liberty  and  rights  as  freemen  and,  secondarily,  their  only 
means  of  bettering  their  condition.  Moreover,  it  is  almost 
entirely  a  matter  of  administration,  which  is  discussed  in  de- 
tail elsewhere  in  the  report.  With  the  great  attention  which 
the  method  of  administration  is  now  receiving,  not  only  from 
labor  organizations  but  from  civic  organizations,  and  lately 
even  from  employers'  associations,  it  is  likely  to  reach  a  sat- 
isfactory stage  before  very  long. 

Eighth,  it  is  charged  that  in  cases  involving  industrial 
questions,  the  workers  are  liable  to  great  injustice  by  reason 
of  the  fact  that  in  many  localities  they  are  excluded  from 
juries  either  by  the  qualifications  prescribed  (usually  pay- 
ment of  property  tax)  or  by  the  method  of  selection. 

In  California,  for  example,  it  was  testified  that  grave 
injustice  had  been  done  in  many  cases  because  the  juries 
(composed  only  of  property  owners,  for  the  most  part  em- 
ployers) were  greatly  prejudiced  against  the  defendants, 
whose  program,  if  successful,  would  directly  or  indirectly 
affect  the  interests  of  the  jurors. 

Similarly,  in  Cook  County,  Illinois,  which  includes  Chicago, 
it  was  found  by  a  committee  of  the  Lawyers'  Association  of 
Illinois  that,  although  the  system  of  selection  by  commission- 
ers was  intended  to  produce  an  impartial  selection  from  all 
classes  of  the  community,  out  of  probably  1000  different 
occupations  in  Cook  County  the  commissioners  confine  the 
selection  of  the  great  bulk  of  the  jurors  to  the  following  ten 
occupations:  Managers,  superintendents,  foremen,  presi- 
dents and  owners  of  companies,  secretaries  of  companies, 
merchants,  agents,  salesmen,  clerks,  and  bookkeepers. 

To  quote  from  the  report : 

There  are  76,000  mechanics  affiliated  with  the  Building 
Trades  Council  in  Chicago,  yet  in  the  3,440  jurors  inves- 
tigated by  your  committee  there  are  only  200  mechanics 
drawn  from  the  76,000  in  the  Building  Trades  Council. 

There  are  about  200,000  mechanics  belonging  to  the 


66 

different  labor  organizations  in  Chicago,  yet  there  are 
only  about  350  mechanics  drawn  as  jurors  by  the  commis- 
sions in  the  3,440  investigated,  or  about  10  per  cent, 
when  the  percentage  ought  to  be  about  70  per  cent. 

The  report  of  the  committee  adds : 

Another  comparison  will  show  that  out  of  these  3,440 
jurors  the  commission  took  only  314  jurors  from  130 
different  occupations,  or  an  average  of  less  than  three 
jurors  from  each  occupation,  while  from  the  ten  favored 
occupations  mentioned  above,  1,723  jurors  were  picked, 
or  the  grossly  excessive  average  of  172  from  each  of  said 
ten  occupations.1 

A  similar  situation  was  disclosed  by  the  investigations  of 
members  of  the  staff  in  Paterson,  N.  J. 

Finally,  there  is  the  very  grave  situation  where,  by  putting 
aside  the  legal  and  customary  methods,  the  jury  is  chosen  by 
the  sheriff  or  other  officers,  who  may  be  unduly  influenced  by 
either  party  to  the  case.  Such  a  situation,  inimical  in  the  ex- 
treme to  the  interests  of  the  workers,  has  been  conclusively 
proved  to  have  existed  in  Colorado  and  in  other  mining  dis- 
tricts. 

In  the  belief  that  the  right  to  trial  by  an  impartial  jury  is 
necessary  for  the  maintenance  of  justice,  and  that  such  im- 
partiality can  be  secured  only  by  including  all  classes  of  citi- 
zens, it  is  suggested  that  the  Commission  recommend  that 
Federal  and  State  statutes  should  be  passed  providing  for 
the  creation  of  juries  by  drawing  the  names  from  a  wheel  or 
other  like  device,  which  shall  contain  the  name  of  every 
qualified  voter  in  the  district  from  which  the  jury  is  to  be 
selected.  The  adoption  of  this  method  in  Missouri  and  other 
States  has  resulted  uniformly  in  securing  impartial  juries  of 
much  higher  grade,  and  has  also  eliminated  almost  entirely 
the  sources  of  corruption  attending  the  selection  of  juries. 

1 — Eternal  Vigilance  is  the  Price  of  Liberty.     Report  of  Committee  to  The 
Lawyers'  Association  of  Illinois,  1914. 


67 

Ninth,  it  is  charged  by  the  workers  that,  during  strikes, 
innocent  men  are  in  many  cases  arrested  without  just  cause, 
charged  with  fictitious  crimes,  held  under  excessive  bail,  and 
treated  frequently  with  unexampled  brutality  for  the  purpose 
of  injuring  the  strikers  and  breaking  the  strike. 

In  support  of  this  charge,  the  Commission  has  been  fur- 
nished with  evidence  showing  that  in  a  number  of  recent 
strikes  large  numbers  of  strikers  were  arrested,  but  that  only 
a  small  number  were  brought  to  trial,  and  relatively  few 
were  convicted  of  any  serious  offense;  that  those  arrested 
were,  as  a  rule,  required  to  give  heavy  bail,  far  beyond  their 
means,  or  were  detained  without  trial  until  their  effective- 
ness as  strikers  was  destroyed ;  and  that  in  many  cases  strik- 
ers were  brutally  treated  by  the  police  or  by  special  depu- 
ties in  the  pay  of  the  companies.  A  number  of  these  strikes 
have  been  investigated  by  public  hearings  of  the  Commission, 
by  members  of  its  staff,  or  by  other  departments  of  the  Fed- 
eral Government.  In  each  of  the  strikes  investigated,  the 
charges  as  made  were  in  essentials  substantiated. 

In  Paterson,  N.  J.,  which  Avas  investigated  with  unusual  thor- 
oughness and  which,  because  of  its  size  and  its  location  in 
the  most  densely  populated  section,  might  be  considered 
likely  to  be  free  from  such  abuses,  it  was  found  that  during 
the  strike  of  the  silk  workers,  2238  arrests  charging  unlaw- 
ful assembly  or  disorderly  conduct  were  made,  and  that  in 
all  there  were  300  convictions  in  the  lower  courts.  Men  ar- 
rested for  unlawful  assembly  were  held  in  bail  of  $500  to 
$5000.  The  right  of  trial  by  jury  was  generally  denied. 
Men  were  arrested  for  ridiculous  reasons,  as,  for  example, 
for  standing  on  the  opposite  side  of  the  street  and  beckoning 
to  men  in  the  mills  to  come  out.  This  was  the  allegation  on 
which  the  charge  of  unlawful  assembly  was  placed  against 
four  men,  and  for  which  they  were  sent  to  jail  in  default  of 
$500  bail,  and,  although  never  indicted,  the  charges  still  stand 
against  them  as  a  bar  to  their  rights  as  citizens  and  voters. 
Men  were  fined  arbitrarily,  as  in  the  case  of  one  who  was 
fined  $10  for  permitting  strikers  to  sit  on  a  bench  in  front 


68 

of  his  house.  Not  more  than  $25  worth  of  damage  was  done 
during  the  entire  strike,  involving  25,000  workers,  and  there 
was  no  actual  violence  or  attempt  at  violence  on  the  part  of 
the  strikers  during  the  entire  strike.  Under  such  conditions 
the  editor  of  a  local  paper  was  arrested,  charged  with  crim- 
inal libel,  for  comparing  the  conditions  in  Paterson  with  the 
rule  of  Cossacks;  and  four  men  who  sold  the  paper  on  the 
streets  also  were  arrested.  The  editor  was  tried  and  con- 
victed in  the  lower  court,  but  the  verdict  was  set  aside  by  the 
Supreme  Court,  while  the  four  men,  after  being  held  several 
days  in  default  of  bail,  were  released  without  trial. 

It  is  impossible  to  summarize  the  activities  of  the  police 
and  authorities  during  this  strike  better  than  by  referring 
to  the  testimony  of  two  of  the  leading  citizens  of  Paterson, 
who  said  that  they  had  resolved  to  get  rid  of  the  ' '  agitators ' ' 
and  were  ready  to  go  beyond  the  law  to  accomplish  their 
purpose.1  A  full  appreciation  of  the  injustice  committed 
during  this  strike  can  be  secured  only  by  reading  the  testi- 
mony taken  at  Paterson,  and  the  reports  of  the  Commission's 
investigators  based  upon  the  records  of  the  police  and  the 
courts. 


1 — In  a  letter  recently  received  from  one  of  these  witnesses  his  position  is 
reiterated  with  a  striking  illustration  of  inability  to  comprehend  the 
fundamental  principles  of  American  Government  and  the  limitations 
imposed  upon  the  power  of  one  class  to  oppress  another: 

"Another  point  which  is  only  partially  covered  in  my  testimony  is 
in  regard  to  what  Chairman  Walsh  endeavored  to  get  me  and  various 
other  citizens  to  admit  would  be  an  infraction  of  free  speech  and  per- 
sonal liberty  if  the  agitators  were  prevented  from  coming  into  Paterson 
or  not  permitted  to  hold  their  meetings  here.  The  U.  S.  Government 
puts  up  the  bars  at  Ellis  Island  against  certain  classes  of  'undesirable 
citizens'  and  as  far  as  I  have  been  able  to  learn  the  Government's  action 
in  debarring  from  this  country  the  immoral  and  criminal  class  and  those 
who  would  become  a  charge  on  the  country  meets  with  the  approval  of 
the  Americans  generally.  If  it  is  proper  and  right  for  the  U.  S.  Govern- 
ment to  say  who  shall  and  who  shall  not  enter  this  country  I  think  it  is 
equally  proper  for  the  City  of  Paterson  to  debar  undesirable  citizens 
who  are  coming  here  to  sow  discontent  and  cause  trouble  in  the  City. 
New  York  City  has  had  a  dead  line  at  Fulton  Street  for  a  great  many 
years  and  the  police  authorities  have  prevented  certain  persons  from 
crossing  that  line,  and  this  has  been  considered  a  proper  exercise  of  the 
police  powers  of  the  City.  I  can  see  no  difference  between  this  action  on 
the  part  of  the  New  York  authorities  and  similar  action  which  was  de- 
sired by  many  of  our  citizens  in  Paterson  in  regard  to  the  I.  W.  W. 
agitators." 


69 

In  Los  Angeles  and  Indianapolis  essentially  the  same  con- 
ditions were  found  by  the  Commission,  while  in  McKees 
Rocks,  Bethlehem,  and  Westmoreland  County,  Pa.,  Lawrence, 
Mass.,  and  Calumet,  Mich.,  investigated  by  the  Federal  De- 
partment of  Labor,  essentially  the  same  conditions  of  injus- 
tice were  found  to  prevail.  The  conditions  in  West  Virginia 
and  Colorado,  which  were  almost  beyond  belief  and  had  the 
additional  feature  of  military  rule,  will  be  discussed  else- 
where. 

An  examination  of  the  entire  mass  of  evidence  is  convinc- 
ing that  such  conditions  are  in  fact  typical  of  strikes  which 
are  serious  enough  to  arouse  the  authorities,  especially  where 
the  workers  are  unorganized  before  the  strike  and  therefore 
lacking  in  influence  in  the  community. 

Tenth,  it  is  asserted  by  the  workers  that  in  many  localities 
during  strikes  not  only  is  one  of  the  greatest  functions  of 
the  State,  that  of  policing,  virtually  turned  over  to  employ- 
ers or  arrogantly  assumed  by  them,  but  criminals  employed 
by  detective  agencies  and  strikebreaking  agencies  are  clothed, 
by  the  process  of  deputization,  with  arbitrary  power  and  re- 
lieved of  criminal  liability  for  their  acts. 

Only  three  such  cases  are  cited  here,  though  the  Commis- 
sion has  in  its  records  evidence  regarding  a  considerable 
number.  At  Roosevelt,  N.  J.,  it  was  found  by  the  Commis- 
sion's investigators  and  later  confirmed  in  court,  that  the 
office  of  sheriff  was  virtually  turned  over  to  one  Jerry 
O'Brien,  the  proprietor  of  a  so-called  detective  agency,  that 
he  imported  a  number  of  men  of  bad  reputation  and  clothed 
them  with  the  authority  of  deputies,  and  that  on  January 
19,  1915,  these  criminals,  without  provocation,  wantonly  shot 
and  killed  two  men,  and  wounded  17  others,  who  were  on 
strike  against  the  American  Agricultural  Chemical  Company, 
which  paid  and  armed  the  deputies. 

Similarly,  during  the  Calumet,  Mich.,  strike,  about  230  men 
were  imported  from  detective  agencies  in  eastern  cities,  52 
under  pay  from  the  county  board  of  supervisors,  which  was 
made  up  almost  entirely  of  copper  company  officials.     The 


70 

actions  of  these  men  were  so  wantonly  brutal  that  they  were 
censured  by  the  local  judge,  but  they  went  unchecked  in  their 
career  of  arrogant  brutality,  which  culminated  in  their  shoot- 
ing, without  provocation,  into  a  house  in  which  women  and 
children  were,  killing  two  persons  and  wounding  two  others. 

The  recent  strike  in  Bayonne,  N.  J.,  threw  more  light  on 
these  armed  guards.  During  this  strike  one  of  the  New  York 
detective  agencies  furnished,  for  the  protection  of  the  Tide- 
water Oil  Company's  plant,  men  who  were  so  vicious  and 
unreliable  that  the  officials  of  the  company  themselves  say 
that  their  presence  was  sufficient  to  incite  a  riot.  These  men 
shot  without  provocation  at  anyone  or  everyone  who  came 
within  sight,  and  the  killing  of  at  least  three  strikers  in  Bay- 
onne, and  the  wounding  of  many  more,  is  directly  chargeable 
to  these  guards. 

The  character  of  the  men  who  make  a  specialty  of  this  kind 
of  employment  has  never  been  more  frankly  described  than 
in  the  testimony  of  Mr.  L.  M.  Bowers,  Chairman  of  the  Board 
of  Directors  of  the  Colorado  Fuel  &  Iron  Company,  who  re- 
peatedly referred  to  those  in  the  employ  of  that  company  as 
"cut-throats,"  against  whose  character,  he  stated,  he  had 
frequently  protested. 

According  to  the  statement  of  Berghoff  Brothers  &  Wad- 
dell,  who  style  themselves  "labor  adjusters"  and  who  do 
a  business  of  strike  breaking  and  strike  policing,  there 
are  countless  men  who  follow  this  business  at  all  times. 
They  say  they  can  put  10,000  armed  men  into  the  field  inside 
of  seventy-two  hours.  The  fact  that  these  men  may  have  a 
criminal  record  is  no  deterrent  to  their  being  employed ;  and 
no  check  can  be  made  on  the  men  sent  out  by  these  companies 
on  hurry  calls. 

When  the  question  of  providing  the  bail  for  these  men 
arose,  as  a  result  of  the  killing  of  the  strikers  at  Bayonne, 
the  company  attorney  actually  declined  to  furnish  bail  to 
them,  on  the  ground  that  they  were  thugs  of  whom  the  com- 
pany knew  nothing  and  that  it  would  not  be  responsible  for 
their  appearance. 


71 

In  view  of  the  endless  crimes1  committed  by  the  employees 
of  the  so-called  detective  agencies,  who  have  been  permitted 
to  usurp  a  function  that  should  belong  only  to  the  State,  it 
is  suggested  that  the  Commission  recommend  to  Congress 
either  that  such  of  these  agencies  as  may  operate  in  more 
than  one  State,  or  may  be  employed  by  corporations  engaged 
in  interstate  commerce,  or  may  use  the  mails,  shall  be  com- 
pelled to  take  out  a  Federal  license,  with  regulations  to  in- 
sure the  character  of  their  employees  and  the  limitation  of 
their  activities  to  the  bona  fide  business  of  detecting  crime, 
or  that  such  agencies  shall  be  utterly  abolished  through  the 
operation  of  the  taxing  power  or  through  denying  them  the 
use  of  the  mails. 

Eleventh,  it  is  charged  that  in  many  localities  the  entire 
system  of  civil  Government  is  suspended  during  strikes  and 
there  is  set  up  in  its  place  a  military  despotism  under  so- 
called  martial  law. 

In  West  Virginia,  for  example,  during  the  strike  of  coal 
miners  in  1912,  martial  law  was  declared  and  the  writ  of 
habeas  corpus  denied,  in  the  face  of  a  direct  prohibition  by 
the  Constitution  of  the  State,  in  spite  of  the  fact  that  the 
courts  were  open  and  unobstructed,  and  without  reference 
to  the  protests  of  the  strikers.  Persons  outside  the  military 
zone  were  arrested,  dragged  before  military  courts,  tried 
and  sentenced  under  so-called  martial  law.  Upon  appeal  to 
the  civil  courts  of  the  State,  the  actions  of  the  military  au- 
thorities were  upheld  in  spite  of  the  oath  of  the  judges  to 
support  the  Constitution,  which  in  terms  provided  "that  no 
citizen,  unless  engaged  in  the  military  service  of  the  State, 
shall  be  tried  or  punished  by  any  military  court  for  any  of- 
fense that  is  cognizable  by  the  civil  courts  of  the  State,"  and 
further,  "The  privilege  of  the  writ  of  habeas  corpus  shall 
not  be  suspended.' ■ 

The  decisions  of  the  court  stirred  Hon.  Edgar  M.  Cullen, 


1 — See  the  reports  of  Congressional  Committees  which  investigated  the 
Homestead  strike,  the  Pullman  strike,  and  the  recent  strikes  in  Colo- 
rado and  West  Virginia. 


72 

a  former  Chief  Judge  of  the  Court  of  Appeals  of  New  York 
(a  witness  before  this  Commission  and  recognized  as  unusu- 
ally conservative  and  careful  in  his  utterances),  to  make  the 
following  statements : 

Under  these  decisions  the  life  and  liberty  of  every  man 
within  the  State  would  seem  to  be  at  the  mercy  of  the 
Governor.  He  may  declare  a  state  of  war  whether  the 
facts  justify  such  a  declaration  or  not,  and  that  declara- 
tion is  conclusive  upon  the  courts. 

If  he  declares  only  a  portion  of  the  State  to  be  in  a 
state  of  war,  under  the  decision  in  the  second  case  a 
person  in  any  other  part  of  the  State,  however  distant, 
may  be  arrested  and  delivered  to  the  military  authorities 
in  the  martial  zone,  and  his  fate,  whether  liberty  or  life, 
depends  on  the  action  of  a  military  commission,  for  I 
know  of  no  principle  which  authorizes  a  military  com- 
mission to  impose  the  punishment  of  imprisonment  that 
would  not  equally  authorize  the  imposition  of  the  pun- 
ishment of  death.  Under  that  doctrine,  should  armed 
resistance  to  the  Federal  authority  justifying  a  suspen- 
sion of  the  writ  of  habeas  corpus  occur  in  Arizona  a  citi- 
zen could,  on  a  charge  of  aiding  the  insurrection,  be 
dragged  from  his  home  in  Maine  and  delivered  to  the 
military  authorities  in  Arizona  for  trial  and  punishment. 

The  remedy  suggested  by  the  learned  court,  of  im- 
peachment by  the  legislature,  would  hardly  seem  of  much 
efficacy.  By  impeachment  the  Governor  could  only  be 
removed  from  office.  He  could  not  be  further  punished, 
however  flagrant  his  opposition  may  have  been,  except 
by  a  perversion  of  the  criminal  law;  for  if  the  doctrine 
of  the  courts  is  correct  he  would  not  have  exceeded  his 
legal  power. 

The  Governor  might  imprison  or  execute  the  members 
of  the  legislature,  or  even  the  learned  judges  of  the  Su- 
preme Court  themselves.1 


1 — Address  before  New  York  State  Bar  Association,  1914. 


73 

The  attention  of  the  Commission  has  also  been  directed 
by  witnesses  to  the  repeated  occurrence  of  similar  or,  if  pos- 
sible, more  extreme  conditions  in  Colorado  and  Idaho,  which 
testimony  has  been  confirmed  either  by  the  investigations  and 
hearings  of  the  Commission  or  by  the  reports  of  responsible 
officials  of  the  Federal  Government.  In  Colorado,  martial 
law  has  been  in  effect  ten  times  since  1894.  Similarly  in 
Idaho,  martial  law  has  been  in  effect  on  several  occasions. 
In  both  of  these  States  not  only  have  strikers  been  impris- 
oned by  military  courts,  but  thousands  have  been  held  for 
long  periods  in  "bull  pens,"  hundreds  have  been  forcibly 
deported  from  the  State,  and  so  arrogant  have  the  troops  be- 
come upon  occasions  that  they  have  refused  to  obey  the  man- 
dates of  the  civil  courts,  although  the  constitutions  of  both 
States  provide  that  the  military  shall  always  be  in  strict 
subordination  to  the  civil  power.1  In  fact,  on  one  occasion 
at  least,  when  orders  of  the  court  for  the  production  of  pris- 
oners had  been  ignored  and  the  military  officers  were  sum- 
moned before  the  court,  they  surrounded  the  courthouse  with 
infantry  and  cavalry,  came  into  court  accompanied  by  sol- 
diers with  fixed  bayonets,  and  stationed  a  gatling  gun  in  a 
position  commanding  the  courthouse.2  During  the  recent 
strike  in  Colorado  the  military  was  supreme  and  wielded  its 
arbitrary  power  despotically  and  at  times  brutally. 

Twelfth,  it  is  charged  by  the  workers  that  in  some  local- 
ities the  control  by  the  employers  of  the  entire  machinery 
of  government  is  so  great  that  lawless  acts  on  the  part  of 
agents  of  the  employers  go  unheeded  and  unpunished,  while 
vindictive  action  against  the  leaders  of  the  strike  is  accom- 
plished by  methods  unparalleled  in  civilized  countries.  It  is 
seldom  that  evidence  sufficient  to  substantiate  such  sweeping 
charges  can  be  secured  even  if  the  charges  are  true,  but  in 
the  testimony  and  documents  which  have  been  gathered  by 


1 — Constitution  of  Colorado  1-33.     Constitution  of  Idaho  1-12. 

2— See  report  of  U.  S.  Commissioner  of  Labor,  Carroll  D.  Wright,  on  "Labor 

Disturbances  in  Colorado"  for  a   detailed  history  of  events  up  to  and 

including  1904. 


74 

the  Commission  there  seems  to  be  conclusive  proof  that  in 
one  State  at  least,  Colorado,  such  a  condition  of  complete 
domination  of  the  State  Government  has  prevailed  and,  it 
would  seem,  does  still  prevail. 

first,  Hon.  Frederick  Farrar,  Attorney  General  of  Colo- 
rado, testified  in  substance  as  follows: 

As  a  result  of  a  personal  investigation  into  conditions 
in  Las  Animas  and  Huerfano  Counties,  Colo.,  in  the  sum- 
mer of  1913,  a  very  perfect  political  machine  was  found 
to  exist.  The  head  of  this  political  machine  is  the  sher- 
iff, and  it  is  conducted  along  lines  very  similar  to  those 
maintained  by  corrupt  political  organizations.  It  has  a 
system  of  relief  in  case  of  need,  and  a  system  of  giving 
rewards  to  its  people.  It  was  difficult  to  determine  which 
was  cause  and  which  effect,  but  there  was  undoubtedly 
some  relationship  between  the  political  machine  and  the 
coal  companies.  Witness  believes  the  machine  existed 
through  its  power  as  a  machine  over  the  coal  companies, 
but  has  no  knowledge  of  any  money  being  used.  His  in- 
vestigation did  not  lead  into  question  of  whether  the  ma- 
chine controlled  coroners'  juries  in  cases  of  death  from 
accidents  in  mines,  etc.,  or  of  whether  mining  laws  were 
obeyed. 

Second,    Hon.    Thomas    M.    Patterson,    formerly    United 
States  Senator,  testified: 

The  men  employed  by  the  large  mining  companies  have 
been  used  to  gain  political  power.  There  is  no  doubt  that 
it  is  the  deliberate  purpose  of  these  companies  to  control 
the  officials  of  the  counties  in  which  they  are  operating, 
and  to  have  a  great  influence  in  the  selection  of  judges 
and  in  the  constitution  of  the  courts.  In  this  purpose 
they  have  been  successful.  Election  returns  from  the 
two  or  three  counties  in  which  the  large  companies  oper- 
ate show  that  in  the  precincts  in  which  the  mining  camps 
are  located  the  returns  are  nearly  unanimous  in  favor  of 
the  men  or  measures  approved  by  the  companies,  regard- 


75 

less  of  party.  The  companies  know  whom  they  want 
elected,  and  do  not  hesitate,  judging  from  the  results, 
to  make  it  known. 

Third,  State  Senator  Helen  Ring  Robinson  testified  in  sub- 
stance as  follows : 

As  a  member  of  the  Committee  of  Privileges  and  Elec- 
tions, which  investigated  conditions  in  Las  Animas 
County,  she  listened  for  three  weeks  to  the  story  of  po- 
litical conditions  there.  Long  before  the  strike  was  or- 
dered, she  realized  that  the  industrial  situation  was  hope- 
less because  the  political  situation  appeared  hopeless. 

"I  found  that  while  the  Counties  of  Las  Animas  and 
Huerfano  are  geographically  a  part  of  Colorado,  yet  in- 
dustrially and  politically  they  are  a  barony  or  a  princi- 
pality of  the  Colorado  Fuel  &  Iron  Company.  Such  sit- 
uations of  course  must  mean  a  knitting  together  of  the 
industrial  and  political  situation,  and  I  don't  wish  to 
say  that  the  Colorado  Fuel  &  Iron  Company  have  lim- 
ited their  efforts  to  Las  Animas  and  Huerfano  Counties. 
If  that  were  so,  the  situation  in  the  State  itself  would  not 
be  so  seriously  affected  by  them;  but  they  have  in  time 
past  reached  out  beyond  the  boundaries  of  their  princi- 
pality and  made  and  unmade  Governors ;  men  who  desire 
positions  of  high  place  in  Colorado  would  be  very  loath 
to  antagonize  them  whether  they  lived  in  Las  Animas  or 
Routt  County  or  in  Denver,  and  it  would  not  matter  in 
that  case  to  which  political  party  they  belonged." 

Attention  should  be  called  to  another  aspect  of  the  control 
of  the  machinery  of  government  by  one  class  for  the  oppres- 
sion of  another.  The  scales  of  justice  have  in  the  past  swung 
far  in  one  direction — legislatures,  courts  and  administrative 
officers  under  the  domination  of  corporations  have  grievously 
wronged  the  workers.  There  is  grave  danger  that,  if  the 
workers  assert  their  collective  power  and  secure  the  control 
of  government  by  the  massing  of  their  numbers,  the  scales 
may  swing  equally  far  in  the  other  direction  and  everv  act  of 


76 

injustice,  every  drop  of  blood,  every  moment  of  anguish,  be 
repaid  in  full,  not  upon  some  obscure  and  humble  worker,  but 
upon  those  who  now  glory  in  the  sense  of  boundless  power 
and  security. 

In  the  few  cases  in  which  the  workers  have  momentarily 
secured  control  of  local  situations,  they  have  followed  the  ex- 
amples that  have  been  set  and  have  in  many  instances  used 
their  power  unjustly  and  oppressively.  In  Colorado,  for  ex- 
ample, during  the  strikes  in  the  metal  mines,  where  the  West- 
ern Federation  of  Miners  controlled  a  camp,  they  followed 
the  example  of  the  operators  and  deported  persons  whom 
they  deemed  to  be  obnoxious.  Similarly,  during  the  fight  be- 
tween two  factions  of  the  Western  Federation  of  Miners  in 
Butte,  Mont.,  the  dominant  faction  forced  several  persons  to 
leave  the  city  and  set  aside  the  ordinary  processes  of  law.  It 
is  inevitable  that  this  should  be  the  case,  and  it  is  remarkable 
only  that  the  masses  of  workers,  even  when  acting  as  mobs, 
show  greater  self-restraint  than  do  organizations  made  up 
of  business  men  ordinarily  regarded  as  upright,  respectable 
and  admirable  citizens. 

For  the  security  and  honor  of  the  Nation  the  scales  of  jus- 
tice must  be  brought  to  a  stable  equilibrium.  This  can  be  ac- 
complished only  by  a  realization  by  every  citizen  that  every 
act  of  injustice,  whether  done  in  far-off  states  or  at  one's  very 
door,  whether  affecting  a  friend  or  an  enemy,  is  in  its  conse- 
quences an  invasion  of  one's  own  security  and  a  menace  to 
one's  liberty. 

There  is  reason,  however,  to  expect  that  no  sober  and 
well  considered  action  for  the  removal  of  these  abuses  will 
be  taken,  and  one  may,  without  being  an  alarmist,  share  the 
fears  expressed  by  Judge  Seymour  D.  Thompson:1 

The  dangerous  tendencies  and  extravagant  pretensions 
of  the  courts  which  I  have  pointed  out  ought  not  to  be 
minimized,  but  ought  to  be  resisted.  Their  resistance 
ought  not  to  take  place  as  advised  by  Jefferson,  by  "meet- 


1 — Address  before  State  Bar  Association  of  Texas,  1896. 


77 

ing  the  invaders  foot  to  foot, '  \  but  it  ought  to  take  place 
under  the  wise  and  moderate  guidance  of  the  legal  pro- 
fession, but  the  danger  is  that  the  people  do  not  always 
so  act.  In  popular  governments,  evils  are  often  borne 
with  stolid  patience  until  a  culminating  point  is  reached, 
when  the  people  burst  into  sudden  frenzy  and  redress 
their  grievances  by  violent  and  extreme  measures,  and 
even  tear  down  the  fabric  of  government  itself.  There 
is  danger,  real  danger,  that  the  people  will  see  at  one 
sweeping  glance  that  all  the  powers  of  their  Government, 
Federal  and  State,  lie  at  the  feet  of  us  lawyers,  that  is 
to  say,  at  the  feet  of  a  judicial  oligarchy ;  that  those  pow- 
ers are  being  steadily  exercised  in  behalf  of  the  wealthy 
and  powerful  classes,  and  to  the  prejudice  of  the  scat- 
tered and  segregated  people ;  that  the  power  thus  seized 
includes  the  power  of  amending  the  Constitution;  the 
power  of  superintending  the  action,  not  merely  of  Con- 
gress, but  also  of  the  State  Legislatures;  the  power  of 
degrading  the  powers  of  the  two  houses  of  Congress,  in 
making  those  investigations  which  they  may  deem  acces- 
sory to  wise  legislation,  to  the  powers  which  an  English 
court  has  ascribed  to  British  Colonial  legislatures; 
*  *  *  holding  that  a  venal  legislature,  temporarily 
vested  with  power,  may  corruptly  bargain  away  those  es- 
sential attributes  of  sovereignty  and  for  all  time;  that 
corporate  franchises  bought  from  corrupt  legislatures 
are  sanctified  and  placed  forever  beyond  recall  by  the 
people;  that  great  trusts  and  combinations  may  place 
their  yokes  upon  the  necks  of  the  people  of  the  United 
States,  who  must  groan  forever  under  the  weight,  with- 
out remedy  and  without  hope ;  that  trial  by  jury  and  the 
ordinary  criminal  justice  of  the  States,  which  ought  to 
be  kept  near  the  people,  are  to  be  set  aside,  and  Federal 
court  injunctions  substituted  therefor;  that  those  injunc- 
tions extend  to  preventing  laboring  men  quitting  their 
employment,  although  they  are  liable  to  be  discharged 
by  their  employers  at  any  time,  thus  creating  and  per- 
petuating a  state  of  slavery.     There  is  danger  that  the 


78 

people  will  see  these  things  all  at  once ;  see  their  enrobed 
judges  doing  their  thinking  on  the  side  of  the  rich  and 
powerful;  see  them  look  with  solemn  cynicism  upon  the 
sufferings  of  the  masses,  nor  heed  the  earthquake  when 
it  begins  to  rock  beneath  their  feet;  see  them  present  a 
spectacle  not  unlike  that  of  Nero  fiddling  while  Rome 
burns.  There  is  danger  that  the  people  will  see  all  this 
at  one  sudden  glance,  and  that  the  furies  will  then  break 
loose  and  that  all  hell  will  ride  on  their  wings. 

It  is  true  that  Judge  Thompson  spoke  19  years  ago,  but  the 
real  danger  lies  in  the  fact  that  during  that  period  we  have 
done  little  to  remove  the  evils  cited  by  him,  and  that  there  is 
even  reason  to  fear  that  we  have  simply  moved  nearer  to  the 
danger  line  instead  of  away  from  it. 

In  considering  the  action  which  needs  to  be  taken  it  has 
been  urged  by  some  that  the  end  to  be  achieved  is  to  place 
personal  rights  on  a  parity  with  property  rights.  It  is  neces- 
sary to  render  a  firm  protest  and  warning  against  the  accept- 
ance of  such  an  ideal.  The  establishment  of  property  rights 
and  personal  rights  on  the  same  level  can  leave  only  a  con- 
stant and  ever  growing  menace  to  our  popular  institutions. 
With  the  acceptance  of  such  an  ideal  our  democracy  is  doomed 
to  ultimate  destruction.  Personal  rights  must  be  recognized 
as  supreme  and  of  unalterable  ascendency  over  property 
rights. 

Relief  from  these  grave  evils  can  not  be  secured  by  petty 
reforms.  The  action  must  be  drastic  and  directed  at  the  roots 
from  which  these  evils  spring. 

With  full  recognition  of  the  gravity  of  the  suggestions,  it 
seems  necessary  to  urge  the  Commission  to  make  the  follow- 
ing recommendations: 

1.  That  Congress  forthwith  initiate  an  amendment  to  the 
Constitution  providing  in  specific  terms  for  the  protec- 
tion of  the  personal  rights  of  every  person  in  the  United 
States  from  encroachment  by  the  Federal  and  State  Gov- 
ernments and  by  private  individuals,  associations  and 


79 

corporations.  The  principal  rights  which  should  be  thus 
specifically  protected  by  the  power  of  the  Federal  Gov- 
ernment are  the  privilege  of  the  writ  of  habeas  corpus, 
the  right  to  jury  trial,  to  free  speech,  to  peaceful  assem- 
blage, to  keep  and  bear  arms,  to  be  free  from  unreason- 
able searches  and  seizures,  to  speedy  public  trial,  and  to 
freedom  from  excessive  bail  and  from  cruel  and  unusual 
punishments. 

2.  That  Congress  immediately  enact  a  statute  or,  if  deemed 
necessary,  initiate  a  constitutional  amendment,  specific- 
ally prohibiting  the  courts  from  declaring  legislative  acts 
unconstitutional. 

3.  That  Congress  enact  that  in  all  Federal  cases  where  the 
trial  is  by  jury,  all  qualified  voters  in  the  district  shall 
be  included  in  the  list  from  which  jurors  are  selected 
and  that  they  shall  be  drawn  by  the  use  of  a  wheel  or 
other  device  designed  to  promote  absolute  impartiality. 

4.  That  Congress  drastically  regulate  or  prohibit  private 
detective  agencies  doing  business  in  more  than  one  State, 
employed  by  a  company  doing  an  interstate  business,  or 
using  the  mails  in  connection  with  their  business.  Such 
regulation,  if  it  is  feasible,  should  include  particularly  the 
limitation  of  their  activities  to  the  bona  fide  functions 
of  detecting  crime,  and  adequate  provision  should  be 
made  for  the  rigid  supervision  of  their  organization  and 
personnel. 


80 


4.      Denial  of   the  Right   of   Organization. 

The  previous  discussion  of  the  causes  of  industrial  unrest 
has  dealt  with  the  denial  of  certain  fundamentals  to  which 
the  workers  believe  they  have  natural  and  inalienable  rights, 
namely,  a  fair  distribution  of  the  products  of  industry,  the 
opportunity  to  earn  a  living,  free  access  to  unused  land  and 
natural  resources,  and  just  treatment  by  legislators,  courts 
and  executive  officials.  A  more  serious  and  fundamental 
charge  is,  however,  contained  in  the  allegation  by  the  work- 
ers that,  in  spite  of  the  nominal  legal  right  which  has  been 
established  by  a  century-long  struggle,  almost  insurmount- 
able obstacles  are  placed  in  the  way  of  their  using  the  only 
means  by  which  economic  and  political  justice  can  be  secured, 
namely,  combined  action  through  voluntary  organization. 
The  workers  insist  that  this  right  of  organization  is  funda- 
mental and  necessary  for  their  freedom,  and  that  it  is  inher- 
ent in  the  general  rights  guaranteed  every  citizen  of  a  de- 
mocracy. They  insist  that  ' '  people  can  free  themselves  from 
oppression  only  by  organized  force.  No  people  could  gain 
or  maintain  their  rights  or  liberties  acting  singly,  and  any 
class  of  citizens  in  the  State  subject  to  unjust  burdens  or  op- 
pression can  gain  relief  only  by  combined  action." 

The  demand  for  organization  and  collective  action  has  been 
misunderstood,  it  is  claimed,  because  of  the  belief  among  a 
large  number  of  citizens  that  its  purpose  was  simply  to  secure 
better  wages  and  better  physical  conditions.  It  has  been 
urged,  however,  by  a  large  number  of  witnesses  before  the 
Commission  that  this  is  a  complete  misconception  of  the  pur- 
poses for  which  workers  desire  to  form  organizations.  It 
has  been  pointed  out  with  great  force  and  logic  that  the  strug- 
gle of  labor  for  organization  is  not  merely  an  attempt  to  se- 
cure an  increased  measure  of  the  material  comforts  of  life, 
but  is  a  part  of  the  age-long  struggle  for  liberty;  that  this 
struggle  is  sharpened  by  the  pinch  of  hunger  and  the  exhaus- 
tion of  body  and  mind  by  long  hours  and  improper  working 
conditions ;  but  that  even  if  men  wrere  well  fed  they  would  still 


81 

struggle  to  be  free.  It  is  not  denied  that  the  exceptional  in- 
dividual can  secure  an  economic  sufficiency  either  by  the  sale 
of  his  unusual  ability  or  talent,  or  by  sycophantic  subserv- 
ience to  some  person  in  authority,  but  it  is  insisted  that  no  in- 
dividual can  achieve  freedom  by  his  own  efforts.  Similarly, 
while  it  is  admitted  that  in  some  cases  exceptional  employers 
treat  their  employees  with  the  greatest  justice  and  liberality, 
it  is  held  to  be  a  social  axiom  that  no  group  of  workers  can 
become  free  except  by  combined  action,  nor  can  the  mass  hope 
to  achieve  any  material  advance  in  their  condition  except  by 
collective  effort. 

Furthermore,  it  is  urged  by  the  representatives  of  labor 
that  the  efforts  of  individuals  who  are  bent  upon  bettering 
their  own  condition  without  reference  to  their  health  or  to 
the  interests  of  others,  directly  injure  each  of  their  fellow 
workers  and  indirectly  weaken  the  whole  fabric  of  society. 

It  is  also  pointed  out  that  the  evolution  of  modern  industry 
has  greatly  increased  the  necessity  for  organization  on  the 
part  of  wage  earners.  While  it  is  not  admitted  that  the  em- 
ployer who  has  only  one  employee  is  on  an  economic  equality 
with  the  person  who  is  employed  by  him,  because  of  the  fact 
that  the  employer  controls  the  means  of  livelihood,  which 
gives  him  an  almost  incalculable  advantage  in  any  bargain, 
nevertheless  this  condition  of  inequality  is  held  to  have  been 
enormously  increased  by  the  development  of  corporations 
controlling  the  livelihood  of  hundreds  of  thousands  of  em- 
ployees, and  by  the  growth  of  employers'  associations  whose 
members  act  as  a  unit  in  questions  affecting  their  relations 
with  employees. 

There  have  been  many  able  and  convincing  expositions  of 
this  belief  by  witnesses  before  the  Commission,  but  there  is 
no  other  which  seems  to  have  so  completely  covered  the  en- 
tire field  as  the  testimony  of  Mr.  Louis  D.  Brandeis,  who,  as 
he  stated,  has  studied  this  problem  from  the  standpoint  both 
of  employers  and  of  employees : 

My  observation  leads  me  to  believe  that  while  there 
are    many    single    things — single    causes — contributing 


82 

causes  to  unrest,  that  there  is  one  cause  which  is  funda- 
mental, and  it  is  the  necessary  conflict  between — the  con- 
trast between — our  political  liberty  and  the  industrial 
absolutism. 

We  are  as  free  politically  perhaps  as  it  is  possible  for 
us  to  be.  Every  man  has  his  voice  and  vote  and  the  law 
has  endeavored  to  enable,  and  has  succeeded  practically 
in  enabling,  him  to  exercise  his  political  franchise  with- 
out fear.  He,  therefore,  has  his  part,  and  certainly  can 
secure  an  adequate  part  of  the  government  of  the  coun- 
try in  all  of  its  political  relations — in  all  relations  which 
are  determined  by  legislation  or  governmental  adminis- 
tration. On  the  other  hand,  in  dealing  with  industrial 
problems  the  position  of  the  ordinary  worker  is  exactly 
the  reverse.  And  the  main  objection,  as  I  see  it,  to  the 
large  corporation  is,  that  it  makes  possible — and  in  many 
cases  makes  inevitable — the  exercise  of  industrial  abso- 
lutism. It  is  not  merely  the  case  of  the  individual  worker 
against  employer,  which,  even  if  he  is  a  reasonably  sized 
employer,  presents  a  serious  situation  calling  for  the  in- 
terposition of  a  union  to  protect  the  individual.  But  we 
have  the  situation  of  an  employer  so  potent,  so  well  or- 
ganized, with  such  concentrated  forces  and  with  such 
extraordinary  powers  of  reserve  and  the  ability  to  endure 
against  strikes  and  other  efforts  of  a  union,  that  the  rela- 
tively loosely  organized  masses  of  even  strong  unions  are 
unable  to  cope  with  the  situation. 

We  are  dealing  here  with  a  question  not  of  motive,  but 
of  condition.  Now  the  large  corporation  and  the  man- 
agers of  the  large  corporation — of  the  powerful  corpor- 
ation— are  probably  in  large  part  actuated  by  motives 
just  the  same  as  an  employer  of  a  tenth  of  their  size. 
Neither  of  them,  as  a  rule,  wishes  to  have  his  liberty 
abridged;  but  the  smaller  concern  usually  comes  to  the 
conclusion  that  it  is  necessary  that  it  should  be,  where 
there  is  an  important  union  found.  But  when  you  have 
created  a  great  power,  when  there  exist  these  powerful 
organizations  who  can  afford — not  only  can  successfully 


83 

summon  forces  from  all  parts  of  the  country — but  can 
afford  to  use  tremendous  amounts  of  money  in  any  con- 
flict to  carry  out  what  they  deem  to  be  their  business 
principles,  you  have  necessarily  a  condition  of  inequality 
between  the  two  contending  forces.  The  result  is  that 
contests  undertaken  doubtless  with  the  best  motives  and 
with  strong  conviction  of  what  is  for  the  best  interests 
not  only  of  the  company  but  of  the  community,  lead  to 
absolutism.  In  all  cases  of  these  large  corporations  the 
result  has  been  to  develop  a  benevolent  absolutism — an 
absolutism  all  the  same;  and  it  is  that  which  makes  the 
great  corporation  so  dangerous.  It  is  because  you  have 
created  within  the  State  a  state  so  powerful  that  the 
ordinary  forces  existing  are  insufficient  to  meet  it. 

Now,  to  my  mind  the  situation  of  the  worker  that  is 
involved — and  I  noted,  Mr.  Chairman,  that  when  you  put 
the  question  you  put  the  question  of  physical  condition — 
unrest,  in  my  mind,  never  can  be  removed,  and  fortu- 
nately never  can  be  removed,  by  mere  improvement  of 
the  physical  and  material  condition  of  the  working  man. 
If  it  were,  we  should  run  great  risk  of  improving  their 
material  condition  and  reducing  their  manhood.  We 
must  bear  in  mind  all  the  time  that  however  much  we 
may  desire  material  improvement  and  must  desire  it  for 
the  comfort  of  the  individual,  that  we  are  a  democracy; 
and  that  we  must  have,  above  all  things,  men;  and  it  is 
the  development  of  manhood  to  which  any  industrial  and 
social  system  must  be  directed.  We  are  committed  not 
only  to  social  justice  in  the  sense  of  avoiding  things 
which  bring  suffering  and  harm  and  unequal  distribu- 
tion of  wealth;  but  we  are  committed  primarily  to  de- 
mocracy, and  the  social  justice  to  which  we  are  headed 
is  an  incident  of  our  democracy,  not  an  end  itself.  It  is 
the  result  of  democracy,  but  democracy  we  must  have. 
And  therefore  the  end  to  which  we  must  move  is  a  recog- 
nition of  industrial  democracy  as  the  end  to  which  we 
are  to  work,  and  that  means  this:  It  means  that  the 
problems  are  not  any  longer,  or  to  be  any  longer,  the 


84 

problems  of  the  employer.  The  problems  of  his  business 
— it  is  not  the  employer's  business.  The  union  can  not 
shift  upon  the  employer  the  responsibility  for  the  con- 
ditions, nor  can  the  employer  insist  upon  solving,  ac- 
cording to  his  will,  the  conditions  which  shall  exist;  but 
the  problems  which  exist  are  the  problems  of  the  trade; 
they  are  the  problems  of  employer  and  employee.  No  pos- 
sible degree  of  profit-sharing,  however  liberal,  can  meet 
the  situation.  That  would  be  again  merely  dividing  the 
proceeds  of  business.  That  might  do  harm  or  it  might  do 
good,  dependent  on  how  it  is  applied. 

No  mere  liberality  in  the  division  of  the  proceeds  of 
industry  can  meet  this  situation.  There  must  be  a  divi- 
sion not  only  of  the  profits,  but  a  division  of  the  respon- 
sibilities ;  and  the  men  must  have  the  opportunity  of  de- 
ciding, in  part,  what  shall  be  their  condition  and  how 
the  business  shall  be  run.  They  also,  as  a  part  of  that 
responsibility,  must  learn  that  they  must  bear  the  re- 
sults, the  fatal  results,  of  grave  mistakes,  just  as  the  em- 
ployer. But  the  right  to  assist  in  producing  the  results, 
the  right,  if  need  be,  the  privilege  of  making  mistakes, 
is  a  privilege  which  can  not  be  denied  to  labor,  just  as 
we  must  insist  on  their  sharing  the  responsibilities  for 
the  result  of  the  business. 

Now  to  a  certain  extent  we  get  that  result — are  grad- 
uslly  getting  it — in  smaller  businesses.  The  grave  objec- 
tion to  the  large  business  is  that  almost  inevitably,  from 
its  organization,  through  its  absentee  stockholdership, 
through  its  remote  directorship,  through  the  creation 
practically  of  stewards  to  take  charge  of  the  details  of 
the  operation  of  the  business  and  coming  into  direct  re- 
lation with  labor,  we  lose  that  necessary  cooperation 
which  our  own  aspirations — American  aspirations — of 
democracy  demand.  And  it  is  in  that,  in  my  opinion, 
that  we  will  find  the  very  foundation  of  the  unrest;  and 
no  matter  what  is  done  with  the  superstructure,  no  mat- 
ter how  it  may  be  improved  one  way  or  the  other,  unless 


85 

we  reach  that  fundamental  difficulty,  the  unrest  will  not 
only  continue,  but,  in  my  opinion,  will  grow  worse. 

It  is  very  significant  that  out  of  230  representatives  of  the 
interests  of  employers,  chosen  largely  on  the  recommenda- 
tions of  their  own  organizations,  less  than  half  a  dozen  have 
denied  the  propriety  of  collective  action  on  the  part  of  em- 
ployees. A  considerable  number  of  these  witnesses  have, 
however,  testified  that  they  denied  in  practice  what  they  ad- 
mitted to  be  right  in  theory.  A  majority  of  such  witnesses 
were  employers  who  in  the  operation  of  their  business  main- 
tained what  they,  in  accordance  with  common  terminology, 
called  the  ''open  shop."  The  theory  of  the  "open  shop," 
according  to  these  witnesses,  is  that  workers  are  employed 
without  any  reference  to  their  membership  or  nonmember- 
ship  in  trade  unions ;  while,  as  a  matter  of  fact,  it  was  found 
upon  investigation  that  these  employers  did  not,  as  a  rule, 
willingly  or  knowingly  employ  union  men.  Nevertheless, 
this  is  deemed  by  the  Commission  to  be  a  minor  point.  The 
"open  shop,"  even  if  union  men  are  not  discriminated  against, 
is  as  much  a  denial  of  the  right  of  collective  action  as  is  the 
"antiunion  shop."  In  neither  is  the  collective  action  of  em- 
ployees permitted  for  the  purpose  of  negotiating  with  refer- 
ence to  labor  conditions.  Both  in  theory  and  in  practice,  in 
the  absence  of  legislative  regulation,  the  working  conditions 
are  fixed  by  the  employer. 

It  is  evident,  therefore,  that  there  can  be  at  best  only  a 
benevolent  despotism  where  collective  action  on  the  part  of 
employees  does  not  exist. 

A  great  deal  of  testimony  has  been  introduced  to  show  that 
employers  who  refuse  to  deal  collectively  with  their  workmen 
do  in  fact  grant  audiences  at  which  the  grievances  of  their 
workmen  may  be  presented.  One  is  repelled  rather  than  im- 
pressed by  the  insistence  with  which  this  idea  has  been  pre- 
sented. Every  tyrant  in  history  has  on  stated  days  granted 
audiences  to  which  his  faithful  subjects  might  bring  their 
complaints  against  his  officers  and  agents.  At  these  audi- 
ences, in  theory  at  least,  even  the  poorest  widow  might  be 


86 

heard  by  her  sovereign  in  her  search  for  justice,  That  justice 
was  never  secured  under  such  conditions,  except  at  the  whim 
of  the  tyrant,  is  sure.  It  is  equally  sure  that  in  industry  jus- 
tice can  never  be  attained  by  such  a  method. 

The  last  point  which  needs  to  be  considered  in  this  connec- 
tion is  the  attitude  frequently  assumed  by  employers  that 
they  are  perfectly  willing  to  deal  with  their  own  employees  col- 
lectively, but  will  resist  to  the  end  dealing  with  any  national 
organization,  and  resent  the  intrusion  of  any  persons  acting 
for  their  employees  who  are  not  members  of  their  own  labor 
force.  In  practice  these  statements  have  been  generally 
found  to  be  specious.  Such  employers  as  a  rule  oppose  any 
effective  form  of  organization  among  their  own  employees  as 
bitterly  as  they  fight  the  national  unions.  The  underlying 
motive  of  such  statements  seems  to  be  that  as  long  as  organ- 
izations are  unsupported  from  outside  they  are  ineffective 
and  capable  of  being  crushed  with  ease  and  impunity  by  dis- 
charging the  ringleaders.  Similarly,  the  opposition  to  the 
representation  of  their  employees  by  persons  outside  their 
labor  force,  seems  to  arise  wholly  from  the  knowledge  that 
as  long  as  the  workers*  representatives  are  on  the  payroll 
they  can  be  controlled,  or,  if  they  prove  intractable,  they  can 
be  effectually  disposed  of  by  summary  dismissal. 

To  suggest  that  labor  unions  can  be  effective  if  organized 
on  less  than  a  national  scale,  seems  to  ignore  entirely  the 
facts  and  trend  of  present-day  American  business.  There  is 
no  line  of  organized  industry  in  which  individual  establish- 
ments can  act  independently.  Ignoring  for  the  time  the  cen- 
tralization of  control  and  ownership,  and  also  the  almost  uni- 
versal existence  of  employers'  associations,  the  mere  fact  of 
competition  would  render  totally  ineffective  any  organization 
of  employees  which  was  limited  to  a  single  establishment. 
Advance  in  labor  conditions  must  proceed  with  a  fair  degree 
of  uniformity  throughout  any  line  of  industry.  This  does 
not  indeed  require  that  all  employees  in  an  industry  must 
belong  to  a  national  organization,  for  experience  has  shown 
that  wherever  even  a  considerable  part  are  union  members, 
the  advances  which  they  secure  are  almost  invariably  granted 


87 

by  competitors,  even  if  they  do  not  employ  union  men,  in 
order  to  prevent  their  own  employees  from  organizing. 

The  conclusions  upon  this  question,  however,  are  not  based 
upon  theory,  but  upon  a  thorough  investigation  of  typical  sit- 
uations in  which  the  contrast  between  organization  and  the 
denial  of  the  right  of  organization  could  best  be  studied.  The 
Commission  has  held  public  hearings  and  has  made  thorough 
investigations  in  such  industrial  communities  as  Paterson, 
N.  J.,  Los  Angeles,  Cal.,  Lead,  S.  D.,  and  Colorado,  where 
the  right  of  collective  action  on  the  part  of  employees  is  de- 
nied. These  investigations  have  shown  that  under  the  best 
possible  conditions,  and  granting  the  most  excellent  motives 
on  the  part  of  employers,  freedom  does  not  exist  either  po- 
litically, industrially  or  socially,  and  that  the  fiber  of  man- 
hood will  inevitably  be  destroyed  by  the  continuance  of  the 
existing  situation.  Investigations  have  proved  that  although 
the  physical  and  material  conditions  may  be  unusually  good, 
as,  for  example,  in  Lead  (S.  D.),  they  are  the  price  paid  for 
the  absolute  submission  of  the  employees  to  the  will  of  the 
employing  corporation.  Such  conditions  are,  moreover, 
shown  by  the  hearings  of  the  Commission  and  by  the  investi- 
gations of  its  staff  to  be  unusual.  Los  Angeles,  for  example, 
although  exceptionally  endowed  in  location,  climate  and  nat- 
ural resources,  was  sharply  criticised  for  the  labor  conditions 
which  had  developed  during  its  "open  shop"  regime  even 
by  Mr.  Walter  Drew,  representing  several  of  the  largest  asso- 
ciations which  contend  for  the  "open  shop."  It  is  significant 
that  the  only  claim  ordinarily  made  for  the  conditions  in  such 
establishments  or  localities  is  that  "they  are  as  good  as  are 
secured  by  the  union."  As  a  matter  of  fact,  there  are  few 
establishments  which  make  this  boast,  and  in  the  majority 
the  conditions  were  found  to  be  far  below  any  acceptable 
standards. 

The  Commission  has  also,  through  public  hearings  and  the 
investigations  of  its  staff,  made  a  thorough  and  searching  in- 
vestigation of  the  conditions  in  those  industries  and  estab- 
lishments where  collective  action,  through  the  medium  of 
trade  unions  and  joint  agreements  exists.    It  has  not  been 


88 

found  that  the  conditions  in  such  industries  are  ideal,  nor 
that  friction  between  employers  and  the  unions  is  unknown; 
nor  has  it  been  found  that  the  employees  in  such  industries 
have  entirely  achieved  economic,  political  and  industrial  free- 
dom, for  these  ideals  can  not  be  gained  until  the  fundamental 
changes  in  our  political  and  economic  structure,  which  have 
already  been  referred  to,  have  in  some  way  been  accom- 
plished. It  has  been  found,  however,  that  the  material  con- 
ditions of  the  workers  in  such  industries  and  establishments 
are  on  a  generally  higher  plane  than  where  workers  are  un- 
organized; that  important  improvements  in  such  conditions 
have  been  achieved  as  the  direct  result  of  organization;  that 
the  friction  which  exists  in  such  industries  and  establishments 
has  been  reduced  rather  than  increased  by  organization;  and 
that  the  workers  at  least  have  secured  a  basis  upon  which 
their  political  and  economic  freedom  may  ultimately  be  estab- 
lished. 

The  evils  of  graft,  " machine  politics,"  factional  fights  and 
false  leadership,  which  have  been  found  sometimes  to  exist  in 
such  organized  industries,  are  those  which  are  inevitable  in 
any  democratic  form  of  organization.  They  are  the  same 
evils  which  have  accompanied  the  development  of  the  Amer- 
ican Nation,  and  of  its  States  and  municipalities.  Such  evils 
as  we  have  found  to  exist  are  indeed  to  be  condemned,  but  a 
study  of  the  history  of  these  organizations  seems  to  show 
clearly  that  there  is  a  tendency  to  eradicate  them  as  the  or- 
ganizations become  stronger  and  as  the  membership  becomes 
more  familiar  with  the  responsibilities  and  methods  of  demo- 
cratic action.  Furthermore,  there  is  a  fundamental  principle 
which  applies  in  this  field  as  in  all  other  lines  of  human  ac- 
tivity. This  principle  is  contained  in  the  following  contrast: 
In  democratic  organizations  such  evils  and  excesses  as  may 
arise  tend  to  disrupt  and  destroy  the  organization  and  are 
therefore  self  -eradicating ;  while  in  an  autocracy,  evils  and 
excesses  tend  inevitably  to  strengthen  the  existing  autocrat 
and  can  be  eradicated  only  in  the  event  of  a  revolt  on  the 
part  of  those  who  suffer  from  such  evils.  This  is  the  history 
not  only  of  every  form  of  artificial  association,  but  of  nations. 


89 

The  fundamental  question  for  the  Nation  to  decide,  for  in 
the  end  public  opinion  will  control  here  as  elsewhere,  is 
whether  the  workers  shall  have  an  effective  means  of  adjust- 
ing their  grievances,  improving  their  condition,  and  securing 
their  liberty,  through  negotiation  with  their  employers,  or 
whether  they  shall  be  driven  by  necessity  and  oppression  to 
the  extreme  of  revolt.  Where  men  are  well  organized,  and 
the  power  of  employers  and  employees  is  fairly  well  balanced, 
agreements  are  nearly  always  reached  by  negotiation;  but, 
even  if  this  fails,  the  strikes  or  lockouts  which  follow  are  as 
a  rule  merely  cessations  of  work  until  economic  necessity 
forces  the  parties  together  again  to  adopt  some  form  of  com- 
promise. With  the  unorganized,  there  is  no  hope  of  achieving 
anything  except  by  spontaneous  revolt.  Too  often  has  it  been 
found  that  during  the  delay  of  attempted  negotiations,  the 
leaders  are  discharged,  and  new  men  are  found  ready  to  take 
the  place  of  those  who  protest  against  conditions.  Without 
strike  funds  or  other  financial  support,  the  unorganized  must 
achieve  results  at  once ;  they  can  not  afford  to  wait  for  reason 
and  compromise  to  come  into  play.  Lacking  strong  leaders 
and  definite  organization,  such  revolts  can  only  be  expected  to 
change  to  mob  action  on  the  slightest  provocation. 

Looking  back  over  the  industrial  history  of  the  last  quar- 
ter-century, the  industrial  disputes  which  have  attracted  the 
attention  of  the  country  and  which  have  been  accompanied 
by  bloodshed  and  violence  have  been  revolutions  against  in- 
dustrial oppression,  and  not  mere  strikes  for  the  improvement 
of  working  conditions.  Such  revolutions  in  fact  were 
the  railway  strikes  of  the  late  eighties,  the  Homestead 
strike,  the  bituminous  coal  strike  of  1897,  the  anthracite 
strikes  of  1900  and  1903,  the  strike  at  McKees  Rocks  in  1909, 
the  Bethlehem  strike  of  1910,  the  strikes  in  the  textile  mills 
at  Lawrence,  Paterson  and  Little  Falls,  many  of  the  strikes 
in  the  mining  camps  of  Idaho  and  Colorado,  the  garment 
workers'  strikes  in  New  York  and  other  cities,  and  the  recent 
strikes  in  the  mining  districts  of  West  Virginia,  Westmore- 
land Co.,  Pa.,  and  Calumet,  Mich. 


90 

As  a  result,  therefore,  not  only  of  fundamental  considera- 
tions but  of  practical  investigations,  the  results  of  which  are 
described  in  detail  hereinafter,  it  would  appear  that  every 
means  should  be  used  to  extend  and  strengthen  organi- 
zations throughout  the  entire  industrial  field.  Much  at- 
tention has  been  devoted  to  the  means  by  which  this  can 
best  be  accomplished,  and  a  large  number  of  suggestions  have 
been  received.  As  a  result  of  careful  consideration,  it  is  sug- 
gested that  the  Commission  recommend  the  following  action : 

1.  Incorporation  among  the  rights  guaranteed  by  the  Con- 
stitution of  the  unlimited  right  of  individuals  to  form 
associations,  not  for  the  sake  of  profit  but  for  the  ad- 
vancement of  their  individual  and  collective  interests. 

2.  Enactment  of  statutes  specifically  protecting  this  right 
and  prohibiting  the  discharge  of  any  person  because  of 
his  membership  in  a  labor  organization. 

3.  Enactment  of  a  statute  providing  that  action  on  the  part 
of  an  association  of  individuals  not  organized  for  profit, 
shall  not  be  held  to  be  unlawful  where  such  action  would 
not  be  unlawful  in  the  case  of  an  individual. 

4.  That  the  Federal  Trade  Commission  be  specifically  em- 
powered and  directed  by  Congress,  in  determining  un- 
fair methods  of  competition  to  take  into  account  and  spe- 
cially investigate  the  unfair  treatment  of  labor  in  all  re- 
spects, with  particular  reference  to  the  following  points : 

a.  Refusal  to  permit  employees  to  become  members 
of  labor  organizations. 

b.  Refusal  to  meet  or  confer  with  the  authorized  rep- 
resentatives of  employees. 

5.  That  the  Department  of  Labor,  through  the  Secretary  of 
Labor  or  any  other  authorized  official,  be  empowered  and 
directed  to  present  to  the  Federal  Trade  Commission, 
and  to  prosecute  before  that  body,  all  cases  of  unfair 
competition  arising  out  of  the  treatment  of  labor  which 
may  come  to  its  attention. 


91 

6.  That  such  cases,  affecting  as  they  do  the  lives  of  citi- 
zens in  the  humblest  circumstances,  as  well  as  the  profits 
of  competitors  and  the  peace  of  the  community,  be  di- 
rected by  Congress  to  have  precedence  over  all  other 
cases  before  the  Federal  Trade  Commission. 


92 


CONCLUSIONS  AND  RECOMMENDATIONS. 


The  remainder  of  the  report  is  devoted  largely  to  the  con- 
elusions  and  recommendations  with  respect  to  specific  ques- 
tions propounded  by  Congress.  The  facts  upon  which  these 
conclusions  and  recommendations  are  based  are  contained  in 
the  testimony  taken  by  the  Commission  and  in  the  reports  of 
its  investigators.  The  complete  corrected  testimony  is  trans- 
mitted to  Congress,  as  well  as  a  carefully  prepared  digest  of 
the  evidence.  The  reports  of  the  investigators  have  likewise 
been  placed  in  the  possession  of  Congress. 

I.     Industrial  Conditions  of  Adult  Workmen  in  Gen- 
eral Industries. 

In  this  section  only  the  conditions  of  adult  workmen  are 
considered,  leaving  the  questions  affecting  women  and  chil- 
dren for  separate  consideration  later.  The  problems  in- 
volved are  essentially  different,  and  the  position  of  women 
and  children  in  relation  to  the  State  may  be  clearly  distin- 
guished from  the  position  of  adult  workmen. 

WAGES. 

As  a  result  of  the  investigations  which  have  been  made  the 
following  conclusions  are  justified : 

1.  The  welfare  of  the  State  demands  that  the  useful  labor 
of  every  able-bodied  workman  should  as  a  minimum  be 
compensated  by  sufficient  income  to  support  in  comfort 
himself,  a  wife,  and  at  least  three  minor  children,  and  in 
addition  to  provide  for  sickness,  old  age,  and  disability. 
Under  no  other  conditions  can  a  strong,  contented  and  effi- 
cient citizenship  be  developed. 


93 

2.  Under  existing  conditions  such  an  income  is  not  received 
by  fully  one-half  of  the  wage  earners  employed  in  in- 
dustry. 

3.  The  natural  resources  of  the  United  States  are  such  that 
an  industrial  population  properly  educated  and  efficiently 
organized  can  produce  enough  to  achieve  this  standard 
of  living. 

4.  It  is  probable  that  even  at  present  the  national  agricul- 
tural and  industrial  output  is  sufficient  to  permit  the  es- 
tablishment of  such  a  standard. 

5.  The  problem  is  therefore  essentially  one  of  distribution. 

6.  The  fixing  of  the  wages  of  adult  workmen  by  legal  enact- 
ment is  not  practicable  nor  desirable  as  a  general  policy, 
except  for  public  employees. 

7.  A  just  standard  of  wages  in  any  industry  or  occupation 

can  best  be  reached  by  collective  bargaining  between 
employers  and  employees  for  the  purpose  of  forming  vol- 
untary joint  agreements.  The  success  and  justice  of  such 
joint  agreements  is,  however,  dependent  upon  the  essen- 
tial equality  of  the  two  parties  and  can  not  be  attained 
unless  effective  organization  exists. 


B* 


It  is  suggested  that  the  Commission  make  the  following 
recommendations : 

1.  In  order  that  the  public  may  be  kept  fully  informed  with 
regard  to  labor  conditions,  and  that  a  proper  basis  of 
facts  should  exist  for  negotiation  and  arbitration,  the  Fed- 
eral Government  should  enact  the  necessary  legislation 
to  provide  for  the  collection,  through  the  Bureau  of 
Labor  Statistics  or  otherwise,  of  the  full  and  exact  facts 
regarding  wages,  hours  of  labor,  and  extent  of  unemploy- 
ment for  every  industry.  Every  employer  should  be  re- 
quired by  law  to  file  with  the  proper  authority  a  sworn 


94 

statement  of  these  facts  according  to  a  prescribed  form. 
These  statistics  should  be  published  annually,  and  the 
full  data  regarding  any  industry  or  plant  should  be 
accessible  to  any  mediator  or  any  other  responsible  citi- 
zen. 

2.  Uniform  statutes  should  be  passed  by  the  legislatures  of 
all  States  requiring  that  wages  be  paid  at  least  semi- 
monthly and  in  cash,  except  where  by  joint  agreement 
other  methods  are  agreed  upon. 


HOURS  OF  LABOR. 

As  a  result  of  investigation  the  following  conclusions  are 
justified : 

1.  The  physical  well-being,  mental  development  and  recrea- 
tional needs  of  every  class  of  population  demand  that 
under  normal  circumstances  the  working  day  should  not 
exceed  eight  hours. 

2.  A  very  large  percentage  of  the  workmen  in  manufactures, 

transportation  and  mining  work  more  than  eight  hours 
per  day. 

3.  This  is  in  marked  contrast  to  the  condition  of  those  whose 
economic  position  enables  them  to  define  the  length  of 
their  own  working  day. 

4.  Practical  experience  has  shown  that  the  reduction  of  work- 
ing hours  is  in  the  interest  not  only  of  the  worker  and 
the  community  generally,  but  of  the  employer. 

5.  The  regulation  by  legal  enactment  of  working  hours  of 
adult  workmen  is  not  generally  practicable  nor  desirable, 
except  for  public  employees. 


95 

It  is  suggested  that  the  Commission  recommend : 

That  in  the  so-called  continuous  occupations,  other  than 
the  movement  of  trains,  requiring  work  during  both  the 
day  and  the  night  for  six  or  seven  days  per  week,  the 
State  and  Federal  Governments  should  directly  inter- 
vene, so  that  the  working  hours  should  not  exceed  eight 
per  day  nor  extend  to  more  than  six  days  per  week. 


SAFETY  AND  SANITATION. 

The  investigations  which  have  been  made  warrant  the  fol- 
lowing conclusions: 

1.  Great  progress  has  been  made  during  recent  years  in  pro- 
moting safety  and  sanitation  in  manufacturing,  mining 
and  transportation. 

2.  The  progress  has  been  most  rapid  in  the  direction  of 
safeguarding  workers  from  industrial  accidents. 

3.  Progress  in  safety  has  been  in  part  the  result  of  con- 
tinued agitation  and  education,  but  has  proceeded  most 
rapidly  and  satisfactorily  since  the  enactment  of  work- 
men's compensation  laws  which  render  unsafe  working 
conditions  expensive  to  the  employer. 

4.  The  movement  has  also  been  largely  promoted  by  the 
formation  of  safety  committees  composed  of  officials  and 
workmen,  and  by  the  creation  of  joint  conferences  of  em- 
ployers and  employees  to  assist  and  advise  State  officials 
in  the  administration  of  the  law  and  in  the  formulation 
of  safety  rules. 

5.  The  campaign  for  safety  needs,  however,  to  be  greatly 
extended  as  rapidly  as  possible.  The  annual  list  of  acci- 
dents, approximately  35,000  fatalities  and  700,000  injuries 
involving  disability  of  over  four  weeks,  can  not  be  re- 


96 

garded  complacently.  From  one-third  to  one-half  of  these 
accidents  have  been  estimated  by  competent  authorities 
to  be  preventable  by  proper  safeguards,  inspection,  and 
control. 

6.  The  advance  in  the  sanitation  of  work  shops  has  been 
less  rapid,  because  not  only  are  the  dangers  less  obvious, 
but  there  is  no  financial  liability  for  diseases  or  deaths 
occurring  as  the  result  of  improper  sanitation.  Future 
progress  in  sanitation  demands  attention  not  only  to 
cleanliness  and  ventilation,  but  to  occupational  diseases. 

7.  The  most  direct  incentive  for  the  promotion  of  sanitation 
would  be  the  adoption  of  a  proper  system  of  sickness  in- 
surance. 

It  is  suggested  that  the  Commission  recommend : 

1.  The  creation  of  a  bureau  of  industrial  safety  (except  that 
the  section  providing  a  museum  of  safety  is  not  endorsed). 
Proper  steps  should  be  taken  to  provide  for  the  coordina- 
tion of  the  work  of  all  Federal  bureaus  whose  work  is 
concerned  with  industrial  safety. 

2.  The  appropriations  of  the  Public  Health  Service  for  the 
investigation  and  promotion  of  industrial  sanitation 
should  be  increased. 


HOUSING. 

It  has  been  found  in  the  course  of  the  Commission's  inves- 
tigations : 

1.  The  present  provisions  for  the  housing  of  workmen  are 
generally  bad,  not  only  in  the  large  cities  but  in  industrial 
communities  of  every  size  and  in  rural  districts. 

2.  Not  only  are  the  houses  and  tenements  which  are  available 
for  workers  largely  insanitary  and  unfit  for  habitation, 


97 

but  they  are  inadequate,  resulting  in  high  rents,  over- 
crowding and  congestion. 

3.  Such  conditions  make  not  only  for  discomfort  and  un- 
happiness,  but  for  disease  and  degeneration. 

4.  The  ordinary  method  of  supplying  houses  through  their 
erection  by  private  capitalists  for  investment  and  specu- 
lation has  rarely  if  ever  been  adequate. 

5.  Excellent  plans  for  the  housing  of  workmen  have  been 
put  into  effect  by  a  number  of  firms  and  corporations, 
but  such  measures  have  not  at  all  affected  the  general 
situation,  and  being  dependent  upon  the  volition  of  in- 
dividuals can  not  be  regarded  as  likely  to  greatly  influence 
progress. 

6.  The  tenement-house  acts,  as  well  as  the  health  ordinances 
and  building  regulations  of  municipalities,  while  gener- 
ally productive  of  good  effects,  are  at  best  surface  rem- 
edies and  can  never  cure  the  evils  of  the  present  housing 
situation. 

7.  In  every  important  European  country  government  aid  and 

direct  intervention  to  curb  speculation  have  proved  to 
be  necessary  for  the  promotion  of  any  real  progress. 

8.  Governmental  action  in  Europe  has  chiefly  taken  the  fol- 
lowing forms : 

a.  Extension  of  credit  to  voluntary  non-profit-making 
associations. 

b.  Construction  by  the  Government  of  buildings  which 
are  leased  for  long  periods  on  easy  terms. 

c.  Exemption  from  taxation  and  other  subsidies  for 
homes  constructed  for  occupancy  by  their  owners. 

d.  Legislation  designed  to  prevent  the  holding  of  land 
out  of  use  and  to  secure  for  the  Government  a  part 
of  the  ''unearned  increment." 


98 
It  is  suggested  that  the  Commission  recommend: 

1.  The  Federal  and  State  Governments  should  instituto  in 
vestigations  directed  not  so  much  to  ascertaining  existing 
housing  conditions,  as  to  formulating  constructive  meth- 
ods by  which  direct  support  and  encouragement  to  the  pro- 
motion of  improved  housing  can  be  given.  Actual  experi- 
ment in  the  promotion  of  housing  should  proceed  as  rap- 
idly as  proper  plans  can  be  drafted. 

2.  Special  attention  should  be  given  to  taxation,  in  order 
that  land  should  as  far  as  possible  be  forced  into  use 
and  the  burden  of  taxation  be  removed  from  home  owners. 

3.  The  municipalities  should  be  relieved  from  all  State  re- 
strictions which  now  prevent  them  from  undertaking  the 
operation  of  adequate  housing  schemes  and  from  en- 
gaging in  other  necessary  municipal  enterprises. 


99 


II.     Women  and  Children  in  Industry. 

The  investigations  and  hearings  of  the  Commission  justify 
the  conclusions : 

1.  As  a  result  of  their  unprotected  condition,  women  and 

children  are  exploited  in  industry,  trade,  domestic  service, 
and  agriculture,  to  an  extent  which  threatens  their  health 
and  welfare  and  menaces  the  well-being  of  future  gen- 
erations. 

2.  The  competition  of  women  and  children  is  a  direct  menace 
to  the  wage  and  salary  standards  of  men. 

3.  Under  present  conditions,  children  are  permitted  by  their 
parents  to  go  to  work  largely  because  their  earnings  are 
necessary  for  the  support  of  the  rest  of  the  family.  The 
restrictive  legislation  of  the  past  quarter-century,  al- 
though admirable  in  purpose  and  ultimate  results,  has 
thrown  a  heavy  burden  upon  the  fathers  and  mothers, 
who,  at  existing  wages,  have  been  barely  able  to  support 
their  families.  The  evidence  shows  that  the  burden  of 
child  labor  legislation  has  rested  upon  the  wage  earners 
rather  than  upon  employers.  It  is  the  testimony  of  en- 
lightened employers  that  the  employment  of  children  is 
unprofitable,  and  that  the  effect  of  excluding  children  from 
factories  has  been  to  increase  rather  than  decrease  profits. 
In  the  interests  of  society  as  a  whole,  further  restric- 
tions on  the  employment  of  immature  children  are  nec- 
essary, but  it  is  important  that  they  should  be  made  with 
an  understanding  that  the  burden  will  rest  primarily 
upon  the  wage  earners,  whose  self-sacrifice  should  be 
fully  recognized. 

4.  The  increasing  employment  of  women  has  been  due  to 
two  primary  causes :  First,  the  low  wages  of  men,  which 
have  made  the  earnings  of  women  necessary  for  the  sup- 


100 

port  of  the  family,  and,  second,  the  inducement  to  em- 
ployers to  substitute  women  for  men  because  they  will 
accept  lower  wages  and  are  less  likely  to  protest  against 
conditions.  The  substitution  of  women  for  men  has  been 
greatly  assisted  by  the  introduction  of  improved  machin- 
ery, which  makes  strength  and  technical  skill  unneces- 
sary. 

5.  The  increased  employment  of  women,  under  present  work- 
ing conditions,  is  a  serious  menace  to  their  own  health 
and  well-being,  to  the  wages  of  their  husbands  and  broth- 
ers, and  to  the  ideals  of  family  life  upon  which  American 
civilization  has  been  established. 

6.  The  conditions  under  which  women  are  employed  in  do- 
mestic service  and  in  agriculture,  merit  the  attention  of 
the  Nation  no  less  than  does  their  employment  in  manu- 
facturing and  trade.  Not  only  is  the  economic  condition 
of  women  employed  in  agriculture  and  domestic  service 
a  matter  of  grave  concern,  but  they  are  subject  to  over- 
work, unreasonable  hours,  and  personal  abuse  of  various 
kinds,  from  which  they  have  been  largely  relieved  in  fac- 
tories and  stores  through  agitation  and  legislation. 

7.  The  position  of  women*  in  industry  has  been  rendered 
doubly  hard  by  reason  of  their  lack  of  training  for  indus- 
trial work,  by  the  oversupply  of  such  labor  and  the  con- 
sequent competition,  by  their  traditional  position  of  de- 
pendence, and  by  their  disfranchisement. 

b.  A  very  thorough  investigation  in  the  New  England  States 
failed  to  show  a  single  manufacturer  who  had  left  a 
State  as  a  result  of  restrictive  factory  legislation.  On 
the  contrary,  the  majority  of  manufacturers  expressed  the 
opinion  that  the  legislation  regulating  conditions  for 
women  and  children  had  been  advantageous  to  the  indus- 
try as  a  whole,  particularly  because  it  placed  all  com- 
petitors upon  the  same  footing.    Similarly,  an  investiga- 


101 

tion  of  the  effects  of  minimum-wage  legislation  failed  to 
show  any  calculable  effects  upon  the  cost  of  production, 
or  upon  the  employment  of  women,  after  a  sufficient 
period  had  elapsed  to  allow  the  necessary  readjustments 
to  be  made. 

9.  Nevertheless,  there  is  a  strong  and  increasing  demand  on 
the  part  of  manufacturers  in  the  more  progressive  States 
that  regulation  of  factory  conditions  should  be  under- 
taken by  the  Federal  Government,  in  order  that  com- 
petitors in  all  parts  of  the  country  should  be  placed  upon 
an  equal  footing  in  this  respect.  The  same  demand  comes 
also  from  the  representatives  of  labor,  not  only  because 
the  argument  of  " interstate  competition"  is  creating 
strong  opposition  to  progressive  legislation,  but  because 
of  the  great  economy  of  effort  which  would  result  from 
having  to  make  the  fight  for  better  legislation  only  at  the 
National  Capital  instead  of  in  45  States. 

It  is  suggested  that  the  Commission  recommend : 

1.  The  recognition  both  by  public  opinion  and  in  such  legis- 
lation as  may  be  enacted,  of  the  principle  that  women 
should  receive  the  same  compensation  as  men  for  the  same 
service. 

2.  Until  this  principle  is  recognized,  and  women  are  ac- 
corded equal  political  rights,  the  extension  of  State  pro- 
tection of  women,  through  legislation  regulating  working 
conditions,  hours  of  service,  and  minimum  wages,  is  highly 
desirable. 

3.  The  increased  organization  of  working  women  for  self- 
protection  and  the  improvement  of  their  industrial  con- 
ditions. 

4.  The  inclusion  of  all  women  working  for  wages,  whether 
in  industry,  trade,  domestic  service,  or  agriculture,  under 
future  legislation  regulating  their  wages,  hours,  or  work- 
ing conditions. 


102 

5.  The  extension  of  the  principle  of  State  protection  of  chil- 
dren and  the  rapid  increase  of  facilities  for  their  educa- 
tion as  outlined  elsewhere. 

6.  The  enactment  by  Congress  of  legislation  embodying  the 
principles  contained  in  the  so-called  Palmer-Owen  bill, 
which  was  before  Congress  at  the  last  session. 


103 


III.      Industrial  Conditions   and   Relations   on   Public 

Utilities. 

GENERAL. 

The  investigations  of  the  Commission  show: 

1.  The  scope  of  the  Newlands  Act,  which  applies  only  to 
employees  engaged  in  the  operation  of  interstate  rail- 
roads, is  too  narrow  and  leaves  the  public  service  in  the 
transmission  of  intelligence  and  in  the  handling  of  in- 
terstate commerce  likely  to  be  interrupted  by  labor  dis- 
putes without  any  adequate  legal  provision  either  for 
mediation  and  conciliation  or  for  making  the  facts  in- 
volved in  the  dispute  known  to  the  public. 

2.  Even  as  applied  to  train  service  employees,  the  Newlands 

Act  provides  no  means  of  bringing  the  facts  before  the 
public,  except  when  both  sides  agree  to  arbitration. 

3.  The  selection  of  impartial  members  of  arbitration  boards 
has  almost  without  exception  devolved  upon  the  Board  of 
Mediation  and  Conciliation,  owing  to  the  inability  of  the 
parties  to  agree.  This  not  only  imposes  an  unpleasant 
and  burdensome  task  upon  the  Board  of  Mediation  and 
Conciliation,  but  tends  greatly  to  weaken  its  influence. 
The  experience  in  Great  Britain  shows  that  agreement  can 
be  reached  by  joint  conference  of  employers  and  em- 
ployees during  a  period  of  industrial  peace  for  the  selec- 
tion of  a  panel  of  impartial  persons  from  which. arbi- 
trators can  be  selected  when  they  are  needed,  and  seems 
to  indicate  that  in  the  United  States  the  inability  of  the 
parties  to  agree  upon  impartial  arbitrators  is  due  in  part 
at  least  to  the  fact  that  they  are  always  selected  during 
the  heat  of  the  conflict. 

It  is  suggested  that  the  Commission  recommend: 

1.  The  extension  of  the  Newlands  Act  to  cover  not  only  all 
classes  of  railroad  employees,  but  all  employees  of  public 


104 

service  corporations  which  are  engaged  in  interstate  com- 
merce. 

2.  The  functions  of  the  Board  of  Mediation  and  Conciliation 
under  the  Newlands  Act  should  be  extended  to  provide 
for  the  creation  of  Boards  of  Investigation,  to  be  formed 
only  by  consent  of  both  parties  and  to  make  a  report  of 
facts  and  recommendations  which  will  not  be  binding 
upon  either  side. 

3.  The  Board  of  Mediation  and  Conciliation  should  be  author- 

ized by  Congress  to  create  an  Advisory  Council,  composed 
of  equal  numbers  of  employers  and  employees,  for  the 
purpose  of  creating  a  panel  of  names  from  which  impar- 
tial arbitrators  may  be  chosen  by  the  Board  of  Mediation 
and  Conciliation. 

TELEGRAPH. 

The  investigations  and  hearings  of  the  Commission  justify 
the  following  conclusions: 

1.  The  workers  employed  by  the  two  principal  telegraph 
companies  (the  Western  Union  Telegraph  and  the  Postal 
Telegraph-Cable)  are  not  only  underpaid,  as  admitted  by 
the  highest  officials  in  their  testimony  before  the  Com- 
mission,1 but  subject  to  many  abuses,  such  as  the  denial 
of  proper  periods  of  relief  while  on  duty,  the  establish- 
ment of  arbitrary  speed  rates,  which  frequently  result 
in  overstrain,  the  arbitrary  discharge  of  employees  with- 
out notice  for  any  cause  or  no  cause,  the  employment  of 
young  boys  for  messenger  service  under  conditions  which 
can  result  only  in  their  moral  corruption,  and  the  em- 
ployment of  women  for  telegraph  service  at  night. 


105 

2.  Such  conditions  have  existed  practically  without  change 
at  least  since  1884,  in  spite  of  the  facts  having  been  made 
public  by  three  Government  investigations. 

3.  The  workers  are  practically  unable  to  improve  their  con- 
dition because  these  two  companies,  which  control  prac- 
tically the  entire  industry,  deny  them  the  right  of  or- 
ganization. The  suppression  of  organization  is  effectively 
carried  out  by  the  discharge  of  all  known  to  be  union 
men  or  union  sympathizers,  by  the  use  of  spies  who  fraud- 
ulently secure  the  confidence  of  employees  and  report  all 
known  to  be  union  members  or  sympathizers,  by  the  use 
of  an  effective  system  of  blacklisting,  and  by  the  control 
even  of  the  personnel  of  the  operators  upon  leased  wires 
in  the  offices  of  brokers  and  other  private  individuals. 

4.  The  two  companies  have  a  monopoly  of  the  transmission 

of  telegrams,  and  no  effective  competition  exists  between 
them.  These  companies  are  performing  a  service  in  the 
transmission  of  intelligence  which  has  been  held  by  the 
Federal  Supreme  Court  to  have  been  reserved  by  the  Con- 
stitution specifically  to  the  Federal  Government. 

5.  The  telegraph  companies  are  enormously  overcapitalized, 

and  their  rates,  which  are  graded  to  pay  dividends  upon 
large  amounts  of  stock  which  do  not  represent  the  invest- 
ment of  cash,  are  very  much  higher  than  the  cost  of  serv- 
ice warrants. 

6.  Owing  to  the  duplication  of  offices  on  the  part  of  the  two 
companies  and  the  maintenance  of  branch  offices  which  are 
idle  for  a  large  part  of  the  time,  this  service  is  being  per- 
formed inefficiently  and  at  an  unusually  high  cost  in  spite 
of  the  low  wages  paid  the  operators. 

It  is  suggested  that  the  Commission  recommend : 

1.  The  property  of  the  telegraph  companies  or  such  part 
of  their  equipment  as  may  be  necessary  for  the  efficient 


106 

operation  of  a  National  telegraph  system,  should  be  pur- 
chased by  the  Federal  Government  after  proper  valua- 
tion and  placed  under  the  general  jurisdiction  of  the  Post 
Office  Department  for  operation.1  In  transferring  the 
service  to  the  Federal  Government  all  employees,  includ- 
ing officials  and  other  persons,  necessary  for  successful 
operation,  should  be  retained,  and  those  whom  the  elimina- 
tion of  the  duplicate  service  of  the  two  companies  renders 
unnecessary  for  the  National  system,  should  be  absorbed 
into  other  branches  of  the  Federal  service  as  far  as  prac- 
ticable. 

2.  At  the  time  of  the  transfer  to  the  Federal  service  a  spe- 
cial commission  should  be  appointed  to  revise  the  salary 
ratings  and  other  working  conditions  and  place  them  upon 
a  proper  basis. 

TELEPHONE. 

The  investigations  of  the  Commission  are  the  basis  for  the 
following  statements: 

1.  The  condition  of  the  telephone  operators  in  both  interstate 
and  local  service  is  subject  to  grave  criticism.  The  wages 
paid  even  in  the  cities  having  the  highest  standards  are 
insufficient  to  provide  decently  for  women  who  have  no 
other  means  of  support.  The  requirements  and  nervous 
strain  incident  to  the  service  are  so  very  severe  that  ex- 
perienced physicians  have  testified  that  operators  should 
work  not  more  than  five  hours  per  day,  whereas  the  reg- 
ular working  hours  are  from  seven  to  nine  per  day.  The 
operators,  who  are  principally  girls  and  young  women, 
are  required  to  work  at  night,  going  to  and  returning 
from  their  work  at  hours  when  they  are  subject  to  grave 
menace.  The  policy  of  the  companies  in  general  provides 
for  sanitary  and  reasonably  comfortable  working  places, 
and  for  attention  to  the  recreation  and  physical  needs 

1 — The  economic  argument  for  the  postalization  of  telegraphs  and  telephones 
is  presented  In  the  testimony  of  Hon.  David  J.  Lewis  before  the  Com- 
mission. 


107 

of  the  operators,  but  in  a  number  of  cities  the  conditions 
even  in  these  respects  are  subject  to  severe  criticism. 

2.  The  telephone  operators  are  unable  to  secure  reasonable 
conditions  for  themselves,  because  of  their  youth  and  the 
fact  that  they  ordinarily  remain  in  the  service  only  a  short 
time. 

3.  The  organization  of  employees  for  their  own  protection 
is  effectively  resisted  by  the  employing  companies. 

4.  The  American  Telephone  and  Telegraph  Company,  with 
its  subsidiary  and  affiliated  corporations,  controls  more 
than  70  per  cent  of  the  total  telephone  business  of  the 
country.  The  American  Telephone  and  Telegraph  Com- 
pany has  been  enormously  profitable  and  is  well  able  to 
afford  the  necessary  improvements  in  working  conditions. 
The  American  Telephone  and  Telegraph  Company  has 
increased  its  capitalization  enormously  without  the  invest- 
ment of  new  capital. 

5.  The  transaction  by  which  the  American  Telephone  and 
Telegraph  Company,  which  had  been  a  subsidiary  of  the 
American  Bell  Telephone  Company,  absorbed  the  parent 
company  in  1899  was  not  only  designed  to  evade  the  legal 
limitations  contained  in  the  Massachusetts  charter  of  the 
American  Bell  Telephone  Company,  but  resulted  in  the 
increase  of  the  capitalization  of  the  combination  from 
$25,886,300  to  $75,276,600  without  the  addition  of  any  new 
capital. 

6.  The  transmission  of  intelligence  is  a  function  which  is 
specifically  reserved  by  the  Constitution  to  the  Federal 
Government,  but  which  in  the  telephone  field  has  been 
permitted  to  become  the  practical  monopoly  of  a  single 
corporation. 

It  is  suggested  that  the  Commission  recommend : 

1.  The  purchase  by  the  Federal  Government,  after  proper 
valuation,  of  the  property  of  the  interstate  and  local  tele- 
phone companies,  or  such  part  of  their  equipment  as  may 


-  '  108 

be  necessary  for  the  efficient  operation  of  a  National  tele- 
phone system. 

2.  The  transfer  of  all  employees,  including  officials,  neces- 
sary for  the  efficient  operation  of  the  National  telephone 
system,  to  the  Federal  service  as  far  as  possible,  and  the 
absorption,  as  far  as  practicable,  of  all  employees  who 
are  not  necessary  for  the  telephone  system  into  other 
branches  of  the  Federal  service. 

3.  When  such  employees  are  transferred  to  the  Federal  serv- 
ice, the  creation  of  a  special  commission  to  establish  sal- 
ary ratings  and  other  working  conditions  on  a  proper 
basis. 

4.  In  the  meantime  provision  should  be  made  by  Congress 
for  the  creation  of  a  minimum  wage  board  to  fix  minimum 
wage  standards  for  women  employees  who  are  engaged 
in  the  transmission  of  messages  in  interstate  commerce. 
The  board  should  be  authorized  to  differentiate  between 
localities  in  fixing  minima,  if  on  due  consideration  such 
differential  rates  should  be  deemed  advisable. 

5.  The  creation  of  minimum  wage  boards  in  the  several 
States  to  fix  minimum  wages  for  all  women  employees 
engaged  in  service  within  the  State. 


THE  PULLMAN  COMPANY. 

The  investigations  and  hearings  of  the  Commission  de- 
veloped the  following  facts : 

1.  The  conductors  and  porters  employed  in  the  car  service 
of  the  Pullman  Company  are  employed  under  conditions 
which  seem  to  require  radical  readjustment.  Both  classes 
of  employees  are  admitted  by  officials  of  the  Company 
to  be  underpaid. 

The  standard  salary  of  the  porters  ($27.50  per  month)  is 


109 

such  that  the  porters  are  obliged  to  secure  tips  from  the 
public  in  order  to  live.  The  Pullman  Company  is  ad- 
mitted by  the  chairman  of  the  Board  of  Directors  to  be 
the  direct  beneficiary  of  the  tips  from  the  public  to  the 
extent  of  the  difference  between  a  fair  wage  and  that 
which  is  now  paid. 

The  hours  of  service  are  extremely  long,  the  regulations 
of  the  Company  allowing  porters  and  conductors  when  in 
service  only  four  hours  sleep  per  night  and  penalizing 
them  severely  if  they  sleep  while  on  duty.  Employees  of 
the  Pullman  Company  are  subject  to  many  other  abuses, 
among  which  may  be  mentioned  the  arbitrary  deduction 
from  their  salaries  for  such  time  as  they  may  not  be 
needed  for  the  actual  service  of  the  Company,  although 
they  are  required  to  report  at  the  office  each  morning 
and  are  sometimes  compelled  to  wait  the  greater  part  of 
the  day  without  compensation;  the  requirement  that 
porters  shall  furnish  blacking  although  they  are  not  per- 
mitted to  charge  passengers  for  the  service  of  shoe  clean- 
ing; the  system  of  arbitrary  penalties  for  the  infraction 
of  multitudinous  rules ;  the  requirement  that  all  employees 
shall  purchase  their  uniforms  from  one  mercantile  estab- 
lishment, the  owners  of  which  are  largely  interested  in  the 
Pullman  Company;  and  the  lack  of  proper  provision  of 
sleeping  quarters  for  employees  when  away  from  their 
home  stations. 

2.  The  Pullman  Company  has  a  bonus  system,  by  which  em- 
ployees who  have  a  " clean  record"  for  the  year  receive 
an  extra  month's  salary.  This  system  serves  to  increase 
the  earnings  of  those  who  receive  the  bonus,  and  is  un- 
questionably appreciated  by  them.  Nevertheless,  it  is 
inequitable  in  penalizing  with  extra  severity  any  infrac- 
tions of  rules  which  occur  during  the  latter  half  of  the 
year,  and  puts  into  the  hands  of  officials  and  inspectors  a 
means  of  discrimination  which  can  be  arbitrarily  exer- 
cised. 


110 

3.  The  effect  of  the  tipping  system  is  not  only  to  degrade 
those  who  are  obliged  by  their  economic  conditions  to 
accept  tips,  but  to  promote  discrimination  in  the  service 
of  the  public. 

4.  The  employees  of  the  Pullman  Company  are  unable  to 
improve  their  condition  through  organization,  as  em- 
ployees known  to  be  members  of  labor  unions  are  dis- 
charged and  through  the  means  of  an  effective  system  of 
espionage  employees  are  deterred  from  affiliating  with 
labor  unions. 

5.  The  Company  is   tremendously   overcapitalized,   having 

increased  its  capitalization  from  $36,000,000  in  1893  to 
$120,000,000  in  1915,  without  the  investment  of  a  single 
dollar  on  the  part  of  the  stockholders.  Upon  the  basis 
of  actual  cash  paid  in,  the  annual  dividends  of  the  Com- 
pany are  not  less  than  twenty-nine  per  cent.  During 
the  history  of  the  Company  the  stockholders  have  received 
cash  dividends  amounting  to  at  least  $167,000,000  and 
special  stock  dividends  of  $64,000,000,  making  a  total  of 
$231,000,000  on  an  actual  investment  of  $32,601,238. 

6.  The  Company  enjoys  a  practical  monopoly  of  the  sleeping 
car  service. 

It  is  suggested  that  the  Commission  recommend: 

1.  The  enactment  by  Congress  of  a  statute  prohibiting  the 
tipping  of  any  employee  of  a  public  service  corporation 
engaged  in  interstate  commerce,  and  providing  a  proper 
fine  for  both  the  giver  and  the  recipient  of  the  tip. 

2.  The  amendment  of  the  existing  law  regulating  the  hours 
of  service  of  train  employees  to  include  the  employees 
engaged  in  the  Pullman  service. 

3.  The  extension  of  the  Newlands  Act,  as  already  suggested, 
to  cover  the  Pullman  Company. 


Ill 


RAILROADS. 

The  investigations  of  the  Commission  with  regard  to  rail- 
roads have  been  too  limited  to  permit  of  general  findings  or 
recommendations.  Enough  evidence  has,  however,  come  be- 
fore the  Commission  with  regard  to  three  points  to  warrant 
attention. 

1.  The  railroad  construction  camps  are  largely  insanitary, 
overcrowded  and  improperly  equipped  for  the  health  and 
comfort  of  the  employees.  In  addition  there  are  many 
abuses,  such  as  overcharging  at  the  commissary  and  graft- 
ing by  foremen. 

2.  The  so-called  voluntary  benefit  associations  of  a  number 
of  the  railroads  constitute,  under  the  present  system  of 
management,  a  great  injustice  to  employees.  These  funds, 
which  are  contributed  almost  entirely  by  the  employees, 
the  management  as  a  rule  paying  only  the  cost  of  admin- 
istration, until  recently  were  generally  used  to  relieve  the 
companies  from  liability  for  accident,  employees  being 
required  to  sign  a  release  in  favor  of  the  company  at  the 
time  that  they  became  members  of  the  benefit  association. 
In  some  cases,  even,  the  membership  is  compulsory.  Nev- 
ertheless the  employees  have  no  voice  in  the  management 
and  receive  no  equity  when  they  are  discharged.  Finally, 
such  associations,  under  their  present  management,  serve 
to  exert  an  undue  influence  over  employees,  since  the 
members,  if  they  quit  the  service  for  any  period  or  for 
any  cause,  sacrifice  to  the  company  all  that  has  been 
paid  in. 

3.  Under  the  authority  granted  by  the  several  States  the 
railroads  maintain  a  force  of  police,  and  some,  at  least, 
have  established  large  arsenals  of  arms  and  ammunition. 
This  armed  force,  when  augmented  by  recruits  from  de- 
tective agencies  and  employment  agencies,  as  seems  to  be 
the  general  practice  during  industrial  disputes,  consti- 


112 

tutes  a  private  army  clothed  with  a  degree  of  authority 
which  should  be  exercised  only  by  public  officials;  these 
armed  bodies,  usurping  the  supreme  functions  of  the  State 
and  oftentimes  encroaching  on  the  rights  of  the  citizens, 
are  a  distinct  menace  to  public  welfare. 

It  is  suggested  that  the  Commission  recommend : 

1.  Thorough  investigation  by  the  Public  Health  Service  of 
railroad  construction  camps  as  well  as  other  labor  camps, 
and  the  preparation  of  definite  plans  for  such  camps 
and  a  standard  code  of  sanitary  regulations. 

2.  The  enactment  by  Congress  of  a  statute  expressly  pro- 
hibiting corporations  engaged  in  interstate  commerce 
from  inducing  or  compelling  their  employees  to  sign  re- 
leases of  liability  for  accidents. 

3.  Congress  should  enact  a  statute  prohibiting  interstate 
employers  from  requiring  their  employees  to  contribute 
to  benefit  funds,  and  providing  for  the  participation  of 
employees  engaged  in  interstate  commerce  in  the  man- 
agement of  all  benefit  funds  and  other  funds  to  which 
they  contribute. 

4.  The  regulation  by  Federal  statute  of  the  employment  of 
police  on  interstate  railroads.  The  statute  should  not  only 
provide  for  the  organization,  personnel  and  powers  of 
such  police,  but  should  definitely  provide  that  during  labor 
disputes  such  police  should  be  subject  to  the  proper  civil 
authorities  and  paid  out  of  the  public  treasury.  The  stat- 
ute should  also  provide  that  such  corporations  should  be 
permitted  to  have  firearms  only  under  license,  requiring 
that  a  definite  record  be  maintained  showing  the  char- 
acter of  each  firearm  and  to  whom  it  is  issued. 

5.  The  assumption  by  the  States  of  full  responsibility  and 
definite  provision  not  only  for  protecting  the  property 
of  railroads,  but  for  preventing  trespass  upon  their  prop- 
erty. 


113 


IV.     Industrial   Conditions   in  Isolated  Communities. 

The  investigations  and  hearings  of  the  Commission  are  the 
basis  for  the  following  statements: 

1.  The  conditions  existing  in  typical  industrial  communities 
which  are  either  wholly  or  in  large  part  owned  or  con- 
trolled by  a  single  corporation  or  individual  employer, 
present  every  aspect  of  a  state  of  feudalism  except  the 
recognition  of  specific  duties  on  the  part  of  the  employer. 
The  employees  in  such  communities  are  dependent  on  a 
single  corporation,  or  employer,  for  their  livelihood.  Fur- 
thermore, the  employer  in  many  cases  controls  the  social 
and  political  life  of  such  communities,  either  by  the  com- 
plete absorption  of  local  political  powers  or  by  domina- 
tion of  the  local  authorities. 

2.  The  fundamental  rights  of  citizens  in  such  communities 
are,  as  a  general  rule,  seriously  abridged  if  not  actually 
denied.  Among  the  rights  most  seriously  violated  are  the 
right  of  free  speech  and  assemblage  and  the  right  of 
public  highways. 

In  some  cases,  as  for  example  in  Colorado,  employers 
in  such  communities  have  assumed  to  usurp  the  functions 
of  the  Federal  Government  itself  in  the  issuance  of  money 
orders,  and  have  not,  only  denied  employees  access  to  the 
post  office  when  located  in  their  company  stores  but  have 
opened  and  otherwise  interfered  with  the  mail  directed  to 
the  employees. 

Such  feudalistic  conditions  tend  to  develop  principally 
in  connection  with  the  private  exploitation  of  natural  re- 
sources, being  most  frequently  found  in  mining  camps, 
lumber  camps  (including  turpentine  camps)  and  large 
plantations.  There  are,  however,  striking  examples  even 
in  the  case  of  manufactures,  as,  for  example,  the  textile 
towns  and  steel  towns. 


114 

3.  The  most  extreme  form  of  domination  and  control  exists 
in  what  are  known  as  "closed  camps",  where  the  em- 
ployer owns  all  the  land  upon  which  such  camps  are  lo- 
cated and,  because  of  this  private  ownership,  not  only 
exercises  control  over  the  local  government,  but  dictates 
arbitrarily  who  shall  be  permitted  to  come  into  or  pass 
through  such  communities.  It  has  frequently  been  argued 
that  such  communities  are  simply  the  inevitable  accom- 
paniment of  the  development  of  new  country  and  will  be 
eliminated  with  time.  This  is  not  true,  however,  as  the 
Commission's  investigations  have  disclosed  a  large  num- 
ber of  "closed  camps"  which  have  been  in  existence  for 
more  than  a  generation. 

It  is  suggested  that  the  Commission  recommend: 

1.  The  enactment  of  appropriate  State  legislation  providing 
that  where  communities  develop,  even  upon  privately 
owned  land,  the  powers  of  the  civil  Government  shall  not 
be  interfered  with,  nor  shall  the  rights  of  access  to  the 
residence  of  any  person  be  restricted,  nor  shall  the  rights 
of  persons  to  come  and  go  unmolested,  to  speak  freely 
and  to  assemble  peacefully,  be  interfered  with  or  consid- 
ered to  stand  upon  a  different  basis  from  the  rights  of 
persons  in  other  communities. 

2.  In  the  case  of  public  lands  containing  timber  or  minerals, 
which  are  now  or  may  hereafter  come  into  the  possession 
of  the  Federal  Government,  it  should  be  provided  by  stat- 
ute that  neither  the  lands  nor  the  mineral  rights  should 
under  any  circumstances  be  sold,  but  should  be  used 
only  upon  lease  for  a  limited  term,  such  lease  to  contain 
as  a  part  of  the  contract  the  conditions  with  regard  to 
the  rights  of  inhabitants  as  recited  above  and  such  lease 
to  be  forfeitable  without  recourse  in  case  of  the  infrac- 
tion of  said  conditions. 

3.  The  Post  Office  Department  should  be  directed  to  report 
to  Congress  all  communities  in  which  the  post  office  is 


115 

in  any  company's  store  or  other  building  operated  by  an 
employer  or  in  which  the  postmaster  is  a  private  em- 
ployer or  the  agent  of  an  employer.  The  report  should 
show  the  facts  separately  for  those  communities  in  which 
the  employer  or  corporation  operates  an  industry  upon 
which  any  large  number  of  inhabitants  are  dependent. 

Congress  and  the  State  legislatures  should  enact  statutes 
providing  that  any  attempt  on  the  part  of  an  employer 
to  influence  his  employees  either  directly  or  indirectly  in 
connection  with  any  Federal  election  either  for  or  against 
any  particular  candidate,  shall  constitute  intimidation; 
and  further  specifying  that  it  shall  constitute  intimidation 
for  any  employer  to  give  notice  to  his  workmen  that  in 
the  event  of  the  election  of  any  particular  candidate,  the 
establishment  will  not  be  operated. 


116 


V.     The  Concentration  of  Wealth  and  Influence. 

The  evidence  developed  by  the  hearings  and  investigations 
of  the  Commission  is  the  basis  for  the  following  statements : 

1.  The  control  of  manufacturing,  mining  and  transportation 
industries  is  to  an  increasing  degree  passing  into  the 
hands  of  great  corporations  through  stock  ownership,  and 
control  of  credit  is  centralized  in  a  comparatively  small 
number  of  enormously  powerful  financial  institutions. 
These  financial  institutions  are  in  turn  dominated  by  a 
very  small  number  of  powerful  financiers. 

2.  The  final  control  of  American  industry  rests,  therefore,  in 
the  hands  of  a  small  number  of  wealthy  and  powerful 
financiers. 

3.  The  concentration  of  ownership  and  control  is  greatest  in 
the  basic  industries  upon  which  the  welfare  of  the  country 
must  finally  rest. 

4.  With  few  exceptions  each  of  the  great  basic  industries 

is  dominated  by  a  single  large  corporation,  and  where  this 
is  not  true,  the  control  of  the  industry  through  stock 
ownership  in  supposedly  independent  corporations  and 
through  credit  is  almost,  if  not  quite,  as  potent. 

5.  In  such  corporations,  in  spite  of  the  large  number  of  stock- 
holders, the  control  through  actual  stock  ownership  rests 
with  a  very  small  number  of  persons.  For  example,  in 
the  United  States  Steel  Corporation,  which  had  in  1911 
approximately  100,000  shareholders,  1.5  per  cent  of  the 
stockholders  held  57  per  cent  of  the  stock,  while  the  final 
control  rested  with  a  single  private  banking  house. 

Similarly  in  the  American  Tobacco  Co.,  before  the  dis- 
solution, 10  stockholders  owned  60  per  cent  of  the  stock. 

6.  Almost  without  exception  the  employees  of  the  large  cor- 

porations are  unorganized,  as  a  result  of  the  active  and 


117 

aggressive  "nonunion"  policy  of  the  corporation  man- 
agements. 

Furthermore,  the  labor  policy  of  the  large  corporations 
almost  inevitably  determines  the  labor  policy  of  the  entire 
industry. 

7.  A  careful  and  conservative  study  shows  that  the  corpora- 
tions controlled  by  six  financial  groups  and  affiliated  in- 
terests employ  2,651,684  wage  earners  and  have  a  total 
capitalization  of  $19,875,200,000.  These  six  financial 
groups  control  28  per  cent  of  the  total  number  of  wage 
earners  engaged  in  the  industries  covered  by  the  report 
of  our  investigation.  The  Morgan-First  National  Bank 
group  alone  controls  corporations  employing  785,499  wage 
earners.  That  this  control  is  effective  is  shown  by  the 
following  telegram  from  J.  P.  Morgan  to  E.  H.  Gary: 

Aix  les  Bains. 
E.  H.  Gary,  New  York. 

Have  received  your  cable  of  yesterday.  My  own  views 
are  in  accordance  with  those  of  the  financial  committee  in 
New  York.  Certainly  until  question  of  wages  has  been 
settled  by  the  coal  and  railroads,  which  still  in  abeyance 
but  settlement  seems  imminent.  Whole  question  wages 
should  be  settled  simultaneously  by  all  interests  if  pos- 
sible. Going  Paris  Wednesday.  Will  see  there  H.  C.  F., 
P.  A.  B.  W.,1  and  will  cable  you  result  of  interview.  If 
possible  and  meets  your  approval,  think  better  wait  until 
after  interview.  Perfectly  delightful  here.  Weather 
superb. 

J.  P.  M.2 

8.     The  lives  of  millions  of  wage  earners  are,  therefore,  sub- 
ject to  the  dictation  of  a  relatively  small  number  of  men. 


1— H.  C.  Frick  and  P.  A.  B.  Widener. 

2 — Read  at  meeting  of  finance  committee,  U.  S.  Steel  Corporation,  April  27, 
1909. 


118 

9.  These  industrial  dictators  for  the  most  part  are  totally 
ignorant  of  every  aspect  of  the  industries  which  they  con- 
trol, except  the  finances,  and  are  totally  unconcerned  with 
regard  to  the  working  and  living  conditions  of  the  em- 
ployees in  those  industries.  Even  if  they  were  deeply 
concerned,  the  position  of  the  employees  would  be  merely 
that  of  the  subjects  of  benevolent  industrial  despots. 

10.  Except,  perhaps,  for  improvements  in  safety  and  sanita- 
tion, the  labor  conditions  of  these  corporation-controlled 
industries  are  subject  to  grave  criticism,  and  are  a 
menace  to  the  welfare  of  the  Nation. 

11.  In  order  to  prevent  the  organization  of  employees  for 
the  improvement  of  working  conditions,  elaborate  sys- 
tems of  espionage  are  maintained  by  the  large  corpora- 
tions which  refuse  to  deal  with  labor  unions,  and  em- 
ployees suspected  of  union  affiliation  are  discharged. 

12.  The  domination  by  the  men  in  whose  hands  the  final 
control  of  a  large  part  of  American  industry  rests  is  not 
limited  to  their  employees,  but  is  being  rapidly  extended 
to  control  the  education  and  "social  service"  of  the 
Nation. 

13.  This  control  is  being  extended  largely  through  the  cre- 
ation of  enormous  privately  managed  funds  for  indefinite 
purposes,  hereinafter  designated  "foundations,"  by  the 
endowment  of  colleges  and  universities,  by  the  creation 
of  funds  for  the  pensioning  of  teachers,  by  contributions 
to  private  charities,  as  well  as  through  controlling  or  in- 
fluencing the  public  Dress. 

14.  Two  groups  of  the  "foundations",  namely,  the  Rocke- 
feller and  Carnegie  Foundations,  together  have  funds 
amounting  to  at  least  $250,000,000,  yielding  an  annual 
revenue  of  at  least  $13,500,000,  which  is  at  least  twice 
as  great  as  the  appropriations  of  the  Federal  Govern- 
ment for  similar  purposes,  namely,  education  and  social 
service. 


119 

15.  The  funds  of  these  foundations  are  exempt  from  taxation, 
yet  during  the  lives  of  the  founders  are  subject  to  their 
dictation  for  any  purpose  other  than  commercial  profit. 
In  the  case  of  the  Rockefeller  group  of  foundations,  the 
absolute  control  of  the  funds  and  of  the  activities  of  the 
institutions  now  and  in  perpetuity  rests  with  Mr.  Rocke- 
feller, his  son,  and  whomsoever  they  may  appoint  as  their 
successors. 

16.  The  control  of  these  funds  has  been  widely  published  as 
being  in  the  hands  of  eminent  educators  and  public-spir- 
ited citizens.  In  the  case  of  the  Rockefeller  foundations, 
however,  not  only  is  the  control  in  the  hands  of  Mr.  John 
D.  Rockefeller,  Jr.,  and  two  of  the  members  of  the  per- 
sonal staff  of  Mr.  John  D.  Rockefeller,  Sr.,  who  consti- 
tute the  finance  committee,  but  the  majority  of  the  trus- 
tees of  the  funds  are  salaried  employees  of  Mr.  Rocke- 
feller or  the  foundations,  who  are  subject  to  personal  dic- 
tation and  may  be  removed  at  any  moment. 

17.  The  funds  of  these  foundations  are  largely  invested  in 
securities  of  corporations  dominant  in  American  indus- 
try, whose  position  has  been  analyzed  under  the  early 
headings  of  this  section.  The  policies  of  these  founda- 
tions must  inevitably  be  colored,  if  not  controlled,  to  con- 
form to  the  policies  of  such  corporations. 

18.  The  funds  of  the  foundations  represent  largely  the  results 
either  of  the  exploitation  of  American  workers  through 
the  payment  of  low  wages  or  of  the  exploitation  of  the 
American  public  through  the  exaction  of  high  prices.  The 
funds,  therefore,  by  every  right,  belong  to  the  American 
people. 

19.  The  powers  of  these  foundations  are  practically  unlimited, 
except  that  they  may  not  directly  engage  in  business  for 
profit.  In  the  words  of  President  Schurman  of  Cornell, 
himself  a  trustee  of  the  Carnegie  Foundation : 


120 

Under  the  terms  of  this  broad  charter  there  is 
scarcely  anything  which  concerns  the  life  and  work 
of  individuals  or  nations  in  which  the  Rockefeller 
Foundation  would  not  be  authorized  to  participate. 
As  the  safety  of  the  State  is  the  supreme  condition 
of  national  civilization  the  foundation  might  in  time 
of  war  use  its  income  or  its  entire  principal  for  the 
defense  of  the  Republic.  In  time  of  peace  it  might  use 
its  funds  to  effect  economic  and  political  reforms 
which  the  trustees  deem  essential  to  the  vitality  and 
efficiency  of  the  Republic.  The  foundation  might 
become  the  champion  of  free  trade  or  protection,  of 
trusts  or  of  the  competing  concerns  out  of  which 
they  grow,  of  socialism  or  individualism,  of  the  pro- 
gram of  the  Republican  Party  or  the  program  of  the 
Democratic  Party.  It  might  endow  the  clergy  of  all 
religious  denominations  or  it  might  subsidize  any 
existing  or  any  new  religious  denomination.  Tomor- 
row it  might  be  the  champion  of  the  Christian  religion 
and  a  hundred  years  hence  furnish  an  endowment 
for  the  introduction  of  Buddhism  into  the  United 
States.  It  might  build  tenement  houses  for  the  poor 
in  New  York  City  or  carry  the  results  of  science  to 
enrich  the  exhausted  soils  of  the  East  or  the  arid 
tracts  of  the  West.  It  might  set  up  an  art  gallery 
in  every  State  of  the  United  States  or  endow  univer- 
sities which  would  rival  the  great  state  universities 
of  the  West.  With  the  consent  of  the  legislature 
it  might  relieve  any  State  of  the  care  of  its  insane, 
pauper,  and  dependent  classes  or  construct  roads  for 
the  benefit  of  farmers  and  motorists.  These  may  not 
be  likely  objects  for  the  application  of  the  funds  of 
the  Rockefeller  Foundation.  I  am  not,  however,  at- 
tempting to  forecast  its  work  but  to  understand  its 
charter. 

And  so  far  as  I  can  see,  the  proposed  charter  would 
authorize  all  these  and  a  multitude  of  similar  activi- 


121 

ties.  If  the  object  of  the  Eockefeller  Foundation 
is  to  be  coextensive  with  human  civilization,  then  it 
may  do  anything  and  everything  which  its  trustees 
think  likely  to  effect  reform  or  improvement  in  the 
material,  economic,  intellectual,  artistic,  religious, 
moral,  and  political  conditions  of  the  American  peo- 
ple or  of  mankind. 

20.  The  charters  of  these  foundations,  with  their  almost 
unlimited  powers,  were  granted  under  conditions  of  such 
laxity  that  it  has  been  testified  by  an  eminent  legal  author- 
ity who  made  an  extensive  investigation  that  those 
granted  by  New  York  State  are  legally  defective  and  un- 
constitutional. Furthermore,  evidence  developed  by  the 
hearings  of  the  Commission  showed  that  in  increasing  the 
number  of  its  trustees  without  complying  with  the  re- 
quirements of  the  law  governing  corporations,  the  Rocke- 
feller Foundation  has  already  been  guilty  of  a  breach 
of  the  law. 

21.  These  foundations  are  subject  to  no  public  control,  and 
their  powers  can  be  curbed  only  by  the  difficult  process 
of  amending  or  revoking  their  charters.  Past  experience, 
as,  for  example,  in  the  case  of  the  insurance  companies, 
indicates  that  the  public  can  be  aroused  only  when  the 
abuses  have  become  so  great  as  to  constitute  a  scandal. 

22.  The  entrance  of  the  foundations  into  the  field  of  indus- 
trial relations,  through  the  creation  of  a  special  division 
by  the  Rockefeller  Foundation,  constitutes  a  menace  to 
the  national  welfare  to  which  the  attention  not  only  of 
Congress  but  of  the  entire  country  should  be  directed. 
Backed  by  the  $100,000,000  of  the  Rockefeller  Foundation, 
this  movement  has  the  poAver  to  influence  the  entire  coun- 
try in  the  determination  of  its  most  vital  policy. 


122 

23.   The  documentary  evidence  in  the  possession  of  the  Com- 
mission indicates: 

a.  That  the  so-called  "investigation  of  industrial  rela- 
tions" has  not,  as  is  claimed,  either  a  scientific  or  a 
social  basis,  but  originated  to  promote  the  industrial 
interests  of  Mr.  Rockefeller.  The  original  letter  in- 
viting Mr.  W.  L.  Mackenzie  King  to  associate  himself 
with  the  Rockefellers  stated  that  Mr.  Rockefeller  and 
Mr.  Greene  in  "their  purely  corporate  capacity  as 
owners  and  directors  of  large  industries"  desired  his 
aid. 

b.  That  the  investigation  forms  part  of  what  Mr. 
Rockefeller,  in  a  letter  to  Mr.  Ivy  L.  Lee  (the  press 
agent  of  the  Colorado  operators),  called  the  "union 
educational  campaign",  which  is  referred  to  by  Mr. 
Bowers  as  ' '  the  fight  for  the  open  shop ' ',  the  results 
of  which  are  clearly  manifested  in  the  conditions 
existing  in  the  camps  of  the  Colorado  Fuel  &  Iron 
Company,  conducted  on  the  "open  shop"  principle. 

c.  That  Mr.  Rockefeller  planned  to  utilize  in  this  cam- 
paign literature  containing  statements  which  were 
known  to  him  at  the  time  to  be  untrue  and  misleading 
(as  for  example  the  numerous  misstatements  in  the 
"Sermon  to  Young  Men"  of  Dr.  Newell  Dwight 
Hillis,  including  the  statement  that  the  Colorado 
operators  offered  to  recognize  the  miners'  union), 
and  also  literature  containing  statements  which  con- 
stituted a* malicious  libel  upon  a  large  body  of  Amer- 
ican citizens — for  example,  the  following  statement 
of  Prof.  John  J.  Stevenson:  "Labor  unions  defy 
the  law  but  are  ever  ready  to  demand  its  protection ; 
their  principles  are  no  better  than  those  of  the  India 
Thugs,  who  practiced  robbery  and  murder  in  the 
name  of  the  goddess  Cali. ' ' 

d.  That  the  investigation  of  industrial  relations  is 
not  being  made  in  good  faith,  inasmuch  as  its  director 


123 

states  that  he  will  not  now  nor  hereafter  make  public 
his  findings  regarding  a  most  important  part  of  his 
investigation,  namely,  the  investigation  in  Colorado. 

24.  The  purpose  of  Mr.  Rockefeller  to  influence  the  public 
press  is  clearly  shown  by  the  employment  of  an  experi- 
enced publicity  expert  as  a  member  of  his  personal  staff, 
and  is  indicated  by  his  evident  interest  in  the  ownership 
or  control  of  a  number  of  publications,  of  which  we  have 
records  dating  from  the  inquiry  of  his  secretary  regard- 
ing the  Pueblo  Star  Journal  in  May,  1913,  to  the  extensive 
conferences  regarding  a  loan  of  $125,000  to  finance  The 
Nation's  Business,  the  organ  of  the  National  Chamber 
of  Commerce,  which  was  established  and  given  a  semi- 
official status  through  the  instrumentalities  of  the  Sec- 
retary of  Commerce  and  Labor  with  the  sanction  of  a 
former  president  of  the  United  States. 

25.  The  extent  of  the  possible  influence  of  these  foundations 
and  private  endowments  of  institutions  for  education 
and  public  service  is  shown  by  a  large  amount  of  evidence 
in  the  possession  of  the  Commission.  The  following  exam- 
ples may  be  cited: 

a.  The  adoption  of  a  definite  line  of  policy  by  the 
Bureau  of  Municipal  Eesearch  of  New  York  to  meet 
the  conditions  imposed  by  Mr.  Rockefeller  in  con- 
nection with  proposed  contributions. 

b.  The  abandonment  by  several  colleges  and  univer- 
sities of  sectarian  affiliations  and  charter  clauses  re- 
lating to  religion  in  order  to  secure  endowments 
from  the  Carnegie  Corporation  and  pensions  for  pro- 
fessors from  the  Carnegie  Foundation  for  the  Ad- 
vancement of  Teaching.  It  would  seem  conclusive 
that  if  an  institution  will  willingly  abandon  its  re- 
ligious affiliations  through  the  influence  of  these  foun- 
dations, it  will  even  more  easily  conform  to  their  will 
any  other  part  of  its  organization  or  teaching. 


124 

26.  Apart  from  these  foundations  there  is  developing  a  de- 
gree of  control  over  the  teachings  of  professors  in  our 
colleges  and  universities  which  constitutes  a  most  serious 
menace.  In  June  of  this  year  two  professors,  known 
throughout  their  professions  as  men  of  great  talent  and 
high  character,  were  dropped  from  the  positions  they  had 
occupied  and  no  valid  reason  for  such  action  was  made 
public.  Both  were  witnesses  before  the  Commission,  and 
made  statements  based  upon  their  own  expert  knowledge 
and  experience  which  were  given  wide  publicity.  One  was 
a  professor  of  law  in  a  state  university,  who  had  acted 
as  counsel  for  the  strikers  in  Colorado ;  the  other  a  pro- 
fessor of  economics,  who  had  not  only  been  active  in 
fights  in  behalf  of  child  labor  legislation  and  other  pro- 
gressive measures  but  had  recently  published  a  work  com- 
paring the  income  paid  for  property  ownership  with  the 
income  paid  for  all  classes  of  service. 

In  the  case  of  the  state  university  we  know  that  the  coal 
operators  in  conjunction  with  other  business  interests  had 
gained  the  ascendancy  and  exercised  a  great  degree  of 
control  over  the  former  Governor  of  the  State,  that  the 
coal  operators  were  bitterly  opposed  to  the  professor  in 
question,  and  that  the  dismissal  of  the  professor  had  been 
publicly  urged  by  the  operators  upon  numerous  occasions, 
and  we  have  the  uncontroverted  statement  of  the  professor 
that  he  had  been  warned  that  if  he  testified  before  the  Com- 
mission he  would  not  be  reappointed.  In  the  case  of  the 
professor  in  the  other  university  (which,  though  privately 
endowed,  receives  large  appropriations  from  the  State) 
we  know  that  its  trustees  are  interested  in  corporations 
which  have  bitterly  opposed  progressive  legislation,  and 
are  men  whose  incomes  are  derived  from  property  owner- 
ship and  not  from  service. 

In  the  face  of  such  an  enormous  problem  one  can  only 
frankly  confess  inability  to  suggest  measures  which  will 
protect  the  Nation  from  the  grave  dangers  described. 
It  is  believed,  however,  that  if  Congress  will  enact  the 


125 

measures  already  recommended,  providing  for  a  heavy 
tax  on  large  inheritances  with  a  rigid  limitation  on  the 
total  amount  of  the  bequest,  for  the  reclamation  by  the 
Federal  Government  of  all  parts  of  the  public  domain 
(including  mineral  rights)  which  have  been  secured  by 
fraud,  and  for  a  tax  on  nonproductive  land  and  natural 
resources,  a  great  step  in  the  right  direction  will  have 
been  taken. 

As  regards  the  "foundations"  created  for  unlimited 
general  purposes  and  endowed  with  enormous  resources, 
their  ultimate  possibilities  are  so  grave  a  menace,  not 
only  as  regards  their  own  activities  and  influence  but  also 
the  benumbing  effect  which  they  have  on  private  citizens 
and  public  bodies,  that  if  they  could  be  clearly  differen- 
tiated from  other  forms  of  voluntary  altruistic  effort,  it 
would  be  desirable  to  recommend  their  abolition.  It  is  not 
possible,  however,  at  this  time  to  devise  any  clear-cut 
definition  upon  which  they  can  be  differentiated. 

As  the  basis  for  effective  action,  it  is  suggested  that  the 
Commission  recommend: 

The  enactment  by  Congress  of  a  statute  providing  that  all 
incorporated  non-profit-making  bodies  whose  present 
charters  empower  them  to  perform  more  than  a  single 
specific  function  and  whose  funds  exceed  one  million  dol- 
lars, shall  be  required  to  secure  a  Federal  charter. 

The  Federal  charter  should  contain  the  following  pro- 
visions : 

a.  Definite  limitation  of  the  funds  to  be  held  by  any 
organization,  at  least  not  to  exceed  the  largest  amount 
held  by  any  at  the  time  of  the  passage  of  the  act. 

b.  Definite  and  exact  specifications  of  the  powers  and 
functions  which  the  organization  is  empowered  to 
exercise,  with  provision  for  heavy  penalties  if  its  cor- 
porate powers  are  exceeded. 


1_A  striking  illustration  of  the  benumbing  effect  of  such  foundations  was 
revealed  by  the  almost  complete  cessation  of  private  activity  for  the  re- 
lief of  the  Belgians  as  soon  as  the  Rockefeller  Foundation  issued  to  the 
press  a  statement  of  its  intention  to  undertake  such  relief. 


126 

c.  Specific  provision  against  the  accumulation  of  funds 
by  the  compounding  of  unexpended  income,  and 
against  the  expenditure  in  any  one  year  of  more  than 
10  per  cent  of  the  principal. 

d.  Rigid  inspection  of  the  finances  as  regards  both  in- 
vestment and  expenditure  of  funds. 

e.  Complete  publicity  through  open  reports  to  the 
proper  Government  officials. 

/.  Provision  that  no  line  of  work  which  is  not  specific- 
ally and  directly  mentioned  in  the  articles  of  incor- 
poration, shall  be  entered  upon  without  the  unani- 
mous consent  and  approval  of  the  board  of  trustees, 
nor  unless  Congress  is  directly  informed  of  such  in- 
tention through  communication  to  the  Clerk  of  the 
House  and  the  Clerk  of  the  Senate,  which  shall  be 
duly  published  in  the  Congressional  Record,  nor  until 
six  months  after  such  intention  has  been  declared. 

2.  Provision  by  Congress  for  the  thorough  investigation,  by 
a  special  Committee  or  Commission,  of  all  endowed  in- 
stitutions, both  secular  and  religious,  whose  property 
holdings  or  income  exceeds  a  moderate  amount.  The 
Committee  or  Commission  should  be  given  full  power 
to  compel  the  production  of  books  and  papers  and  the 
attendance  and  testimony  of  witnesses.  It  should  be 
authorized  and  directed  to  investigate  not  only  the 
finances  of  such  institutions,  but  all  their  activities  and 
affiliations. 

3.  As  the  only  effective  means  of  counteracting  the  influence 
of  the  foundations,  as  long  as  they  are  permitted  to  exist, 
consists  in  the  activities  of  Governmental  agencies  along 
similar  lines,  the  appropriations  of  the  Federal  Govern- 
ment for  education  and  social  service  should  be  cor- 
respondingly increased. 


127 


VI.     The  Land  Question  and  the  Condition  of  Agricul- 
tural Labor. 

It  was  obviously  impossible  for  the  Commission  to  attempt 
a  detailed  investigation  of  agricultural  conditions;  but,  be- 
cause of  the  very  immediate  bearing  of  the  land  question 
on  industrial  unrest,  it  was  felt  necessary  to  make  as  thorough 
investigation  as  possible  of  the  phases  which  seemed  to  have 
the  most  direct  bearing  on  our  general  problem.  The  phases 
selected  for  discussion  were  first,  the  concentration  of  land 
ownership  as  shown  by  existing  statistics ;  second,  the  problem 
of  seasonal  and  casual  agricultural  labor;  third,  the  increase 
and  change  in  the  character  of  farm  tenancy ;  and  fourth,  the 
introduction  of  industrial  methods  into  agriculture  through 
the  development  of  corporations  operating  large  tracts  of 
land.  The  findings  and  recommendations  with  reference  to 
the  concentration  of  ownership  and  the  problems  of  seasonal 
labor  are  set  forth  elsewhere.  At  this  point,  it  is  desired  to 
present  the  results  of  the  investigations  of  tenancy  and  agri- 
cultural corporations. 

The  investigation  of  these  problems  was  confined  practic- 
ally to  the  Southwest,  because  it  is  in  this  region  that  the  sys- 
tems have  become  most  fully  devoloped  and  their  results  in 
the  form  of  the  acute  unrest  of  a  militant  tenant  movement 
are  most  easily  studied.  The  investigations  in  this  region, 
however,  were  very  thorough,  consisting  of  detailed  studies 
and  reports  by  field  investigators,  which  were  later  confirmed 
by  a  public  hearing. 

As  a  result  of  these  investigations  the  following  conclusions 
are  fully  justified : 

1.  Tenancy  in  the  Southwestern  States  is  already  the  pre- 
vailing method  of  cultivation  and  is  increasing  at  a  very 
rapid  rate.  In  1880,  Texas  had  65,468  tenant  families, 
comprising  37.6  per  cent  of  all  farms  in  the  State.  In 
1910,  tenant  farmers  had  increased  to  219,571,  and 
operated  53  per  cent  of  all  farms  in  the  State.    Reckoning 


128 

on  the  same  ratio  of  increase  that  was  maintained  be- 
tween 1900  and  1910,  there  should  be  in  Texas  in  the 
present  year  (1915)  at  least  236,000  tenant  farmers.  A 
more  intensive  study  of  the  field,  however,  shows  that  in 
the  eighty-two  counties  of  the  State  where  tenancy  is 
highest,  the  average  percentage  of  tenants  will  approxi- 
mate sixty. 

For  Oklahoma  we  have  not  adequate  census  figures  so 
far  back,  but  at  the  present  time  the  percentage  of  farm 
tenancy  in  the  State  is  54.8  and  for  the  47  counties  where 
the  tenancy  is  highest  the  percentage  of  tenancy  is  68.13. 

Tenancy,  while  inferior  in  every  way  to  farm  ownership 
from  a  social  standpoint,  is  not  necessarily  an  evil  if  con- 
ducted under  a  system  which  protects  the  tenants  and 
assures  cultivation  of  the  soil  under  proper  and  econo- 
mical methods,  but  where  tenancy  exists  under  such  con- 
ditions as  are  prevalent  in  the  Southwest,  its  increase 
can  be  regarded  only  as  a  menace  to  the  Nation. 

The  prevailing  system  of  tenancy  in  the  Southwest  is 
share-tenancy,  under  which  the  tenant  furnishes  his  own 
seed,  tools  and  teams,  and  pays  to  the  landlord  one-third 
of  the  grain  and  one-fourth  of  the  cotton.  There  is,  how- 
ever, a  constant  tendency  to  increase  the  landlord's 
share,  through  the  payment  either  of  cash  bonuses  or  of 
a  higher  percentage  of  the  product.  Under  this  system 
tenants  as  a  class  earn  only  a  bare  living  through  the 
work  of  themselves  and  their  entire  families.  Few  of  the 
tenants  ever  succeed  in  laying  by  a  surplus.  On  the  con- 
trary, their  experiences  are  so  discouraging  that  they 
seldom  remain  on  the  same  farm  for  more  than  a  year, 
and  they  move  from  one  farm  to  the  next  in  the  constant 
hope  of  being  able  to  better  their  condition.  Without 
the  labor  of  the  entire  family  the  tenant  farmer  is  help- 
less. As  a  result,  not  only  is  his  wife  prematurely  broken 
down,  but  the  children  remain  uneducated  and  without 
the  hope  of  any  condition  better  than  that  of  their  par- 


129 

ents.  The  tenants  having  no  interest  in  the  results  be- 
yond the  crops  of  a  single  year,  the  soil  is  being  rapidly 
exhausted,  and  the  conditions  therefore  tend  to  become 
steadily  worse.  Even  at  present  a  very  large  proportion 
of  the  tenants'  families  are  insufficiently  clothed,  badly 
housed,  and  underfed.  Practically  all  of  the  white  ten- 
ants are  native  born.  As  a  result  of  these  conditions, 
however,  they  are  deteriorating  rapidly,  each  generation 
being  less  efficient  and  more  hopeless  than  the  one  pre- 
ceding. 

4.  A  very  large  proportion  of  the  tenants  are  hopelessly  in 

debt  and  are  charged  exorbitant  rates  of  interest.  Over 
ninety-five  per  cent  of  the  tenants  borrow  from  some 
source,  and  about  seventy-five  per  cent  borrow  regularly 
year  after  year.  The  average  interest  rate  on  all  farm 
loans  is  10  per  cent,  while  small  tenants  in  Texas  pay  15 
per  cent  or  more.  In  Oklahoma  the  conditions  are  even 
worse,  in  spite  of  the  enactment  of  laws  against  usury. 
Furthermore,  over  eighty  per  cent  of  the  tenants  are 
regularly  in  debt  to  the  stores  from  which  they  secure 
their  supplies,  and  pay  exorbitantly  for  this  credit.  The 
average  rate  of  interest  on  store  credit  is  conservatively 
put  at  20  per  cent  and  in  many  cases  ranges  as  high  as 
60  per  cent. 

5.  The  leases  are  largely  in  the  form  of  oral  contracts  which 
run  for  only  one  year  and  which  make  no  provision  for 
compensation  to  the  tenant  for  any  improvements  which 
may  be  made  upon  the  property.  As  a  result,  tenants  are 
restrained  from  making  improvements  and  in  many  cases 
do  not  properly  provide  for  the  upkeep  of  the  property. 

6.  Furthermore,  the  tenants  are  in  some  instances  the  vic- 
tims of  oppression  on  the  part  of  landlords.  This  op- 
pression takes  the  form  of  dictation  of  character  and 
amount  of  crops,  eviction  without  due  notice,  and  dis- 
crimination because  of  personal  and  political  convictions. 


130 

The  existing  law  provides  no  recourse  against  such 
abuses. 

7.  As  a  result  both  of  the  evils  inherent  in  the  tenant  system 

and  of  the  occasional  oppression  by  landlords,  a  state  of 
acute  unrest  is  developing  among  the  tenants  and  there 
are  clear  indications  of  the  beginning  of  organized  resist- 
ance which  may  result  in  civil  disturbances  of  a  serious 
character. 

8.  The  situation  is  being  accentuated  by  the  increasing  tend- 
ency of  the  landlords  to  move  to  the  towns  and  cities, 
relieving  themselves  not  only  from  all  productive  labor 
but  from  direct  responsibility  for  the  conditions  which 
develop.  Furthermore,  as  a  result  of  the  increasing  ex- 
penses incident  to  urban  life,  there  is  a  marked  tendency 
to  demand  from  the  tenant  a  greater  share  of  the  pro- 
ducts of  his  labor. 

9.  The  responsibility  for  the  existing  conditions  rests  not 
upon  the  landlords,  but  upon  the  system  itself.  The 
principal  causes  are  to  be  found  in  the  system  of  short 
leases,  the  system  of  private  credit  at  exorbitant  rates, 
the  lack  of  a  proper  system  of  marketing,  the  absence  of 
educational  facilities,  and  last,  but  not  least,  the  preva- 
lence of  land  speculation. 

10.  A  new  factor  is  being  introduced  into  the  agricultural 
situation  through  the  development  of  huge  estates,  owned 
by  corporations  and  operated  by  salaried  managers  upon 
a  purely  industrial  system.  The  labor  conditions  on 
such  estates  are  subject  to  grave  criticism.  The  wages 
are  extremely  low,  80  cents  per  day  being  the  prevailing 
rate  on  one  large  estate  which  was  thoroughly  investi- 
gated; arbitrary  deductions  from  wages  are  made  for 
various  purposes;  and  a  considerable  part  of  the  wages 
themselves  are  paid  in  the  form  of  coupons,  which  are, 
in  all  essential  particulars,  the  same  as  the  "  scrip" 
which  has  been  the  source  of  such  great  abuse.    Further- 


131 

more,  the  communities  existing  on  these  large  estates  are 
subject  to  the  complete  control  of  the  land-owning  cor- 
poration, which  may  regulate  the  lives  of  citizens  to  al- 
most any  extent.  There  is  an  apparent  tendency  toward 
the  increase  of  these  large  estates  and  the  greatest 
abuses  may  be  expected  if  they  are  allowed  to  develop 
unchecked. 

11.  Prompt  and  effective  action  on  the  part  of  the  States  and 
the  Nation  is  necessary  if  any  alleviation  of  the  condi- 
tions which  have  been  described  is  to  be  achieved. 

It  is  suggested  that  the  Commission  recommend : 

1.  The  development  through  legislation  of  longer  time  farm 
leases  that  will  make  for  fair  rents,  security  of  tenure  and 
protection  of  the  interests  of  the  tenant  in  the  matter  of 
such  improvements  as  he  may  make  on  a  leasehold  in  his 
possession.  Such  legislation  should  look  forward  to  leas- 
ing, systems  that  will  increase  tillage,  improve  the  yield- 
ing powers  of  the  soil  and  maintain  a  greater  population. 

In  order  to  secure  this  desired  end  it  is  suggested  that 
the  Commission  further  recommend  the  creation  of: 

2.  National  and  State  land  commissions  with  powers — 

a.  To  act  as  land  courts  with  powers  to  hear  evidence 
given  by  landlord  and  tenants  as  to  questions  that  have 
to  do  with  fair  rents,  fixity  of  tenure  and  improvements 
made  by  tenants  on  landlords'  property;  to  gather  evi- 
dence, independently  of  both  parties,  that  will  the  better 
enable  such  land  courts  to  arrive  at  the  true  facts  in 
each  case ;  and  to  render  judgment  that  will  be  manda- 
tory for  such  time  as  the  contractual  relationship  may 
be  determined  to  hold. 

b.  To  operate  farm  bureaus  for  the  following  purposes : 

First — To  act  as  an  agent  between  landlords  and  ten- 
ants in  the  distribution  of  tenant  labor. 


132 

Second — To  act  as  an  agent  between  landlords  and  ten- 
ants in  the  preparation  of  equitable  contracts. 

Third — To  act  as  an  information  agency  to  assist  home- 
seeking  farmers. 

Fourth — To  assist  in  the  distribution  of  seasonal  labor. 

3.  The  development  of  better  credit  facilities  through  the 
assistance  of  the  Government  and  cooperative  organiza- 
tion of  farmers  and  tenants.  No  single  measure  can  be 
recommended;  the  results  must  be  achieved  through  the 
development  of  a  sound  rural  credit  system,  the  develop- 
ment of  land  banks,  mortgage  associations  and  credit 
unions.  Foreign  experience  shows  that  through  these 
means  the  rate  of  interest  can  be  greatly  reduced  and 
the  security  of  both  the  borrower  and  the  lender  can  be 
increased. 

4.  The  general  introduction  of  modernized  rural  schools  and 
compulsory  education  of  children.  The  functions  of  the 
school  system  should  extend  beyond  education  to  the  so- 
cial service  of  the  entire  rural  community,  assisting  in 
the  organization  of  farmers  and  tenants  for  cooperative 
purposes,  and  promoting  other  measures  looking  to  the 
community's  welfare. 

5.  The  revision  of  the  taxation  system  so  as  to  exempt  from 
taxation  all  improvements  and  tax  unused  land  at  its  full 
rental  value. 


133 


VII.     Judicial  Settlement  of  Labor  Claims  and  Com- 
plaints. 

The  investigations  of  the  Commission  are  the  basis  for  the 
following  statements : 

1.  Among  workers  of  every  class  there  are  constantly  aris- 
ing various  questions  for  judicial  settlement  which  under 
present  conditions  can  not  be  speedily  or  satisfactorily 
adjusted. 

2.  These  claims  are  of  a  very  diverse  character  and  include 
not  only  cases  of  actual  injustice  through  the  retention 
of  wages,  but  questions  of  interpretation  of  contract  and 
the  establishment  of  justice  in  cases  in  which  contracts 
are  lacking. 

3.  The  ordinary  courts  are  unfitted  to  decide  such  ques- 
tions, not  only  because  of  the  method  of  procedure  but 
because  of  the  unfamiliarity  of  ordinary  magistrates  and 
judges  with  the  conditions  involved  in  such  claims. 

It  is  suggested  that  the  Commission  recommend: 

1.  The  establishment  either  by  the  States  or  by  municipal- 
ities of  industrial  courts  similar  to  those  which  have 
proved  to  be  successful  in  European  countries.  The  or- 
ganization and  method  of  procedure  of  such  courts  are 
described  in  detail  in  Bulletin  No.  98  of  the  United  States 
Bureau  of  Labor  and  need  not  be  discussed  here.     \ 

2.  The  Commissioners  of  Labor  or  the  Industrial  Commis- 
sions of  the  several  States  should  be  authorized  and  di- 
rected, where  such  powers  do  not  now  exist,  to  receive 
the  legal  complaints  of  all  classes  of  workmen,  and,  where 
they  are  found  to  have  a  proper  basis,  to  prosecute  such 
claims  vigorously,  wTith  a  view  to  securing  either  a  vol- 
untary settlement  or  the  award  of  adequate  recompense 
by  the  proper  tribunal.     The  Commissioners  of  Labor 


134 

or  the  Industrial  Commissions  should  be  given  adequate 
legal  assistance  to  enable  them  to  prosecute  such  claims 
promptly  and  vigorously.  Proper  steps  should  be  taken 
to  provide  for  cooperation  with  the  Federal  Immigra- 
tion Bureau,  if  the  recommendation  on  p.  61  is  adopted. 

3.  The  States  and  municipalities  should  consider  the  desira- 
bility of  creating  an  office  similar  to  that  of  the  Public 
Defender  in  Los  Angeles  to  act  in  civil  claims  of  small 
size. 


135 


VIII.     The  Law  Relating  to  Trade  Unions  and  Indus- 
trial Disputes. 

The  Commission  lias  conducted  through  its  agents  exten- 
sive investigations  and  has  held  hearings  at  which  the  per- 
sons who  have  devoted  great  study  to  the  question  of  trade 
union  law  testified  at  length.  The  investigations  were  di- 
rected both  to  establishing  the  present  status  of  the  law  gov- 
erning trade  unions  and  industrial  disputes  and  to  ascertain- 
ing the  practical  effects  of  certain  classes  of  laws  and  court 
decisions.  The  results  of  the  investigations  are  largely  em- 
bodied in  the  reports  of  Mr.  J.  Wallace  Bryan,  of  the  Mary- 
land Bar,  and  Mr.  Edwin  E.  Witte. 

Because  of  the  necessity  for  exactness  in  dealing  with  ques- 
tions which  are  so  involved  and  which  have  to  so  large  an 
extent  been  clouded  by  contradictory  court  decisions,  it  is  im- 
possible to  present  a  satisfactory  summary  of  the  conclusions 
which  have  been  reached  upon  this  subject.  It  may,  however, 
be  said  that  in  substance  the  situation  revealed  by  these  in- 
vestigations is  as  follows: 

1.  The  greatest  uncertainty  exists  regarding  the  legal  status 
of  almost  every  act  which  may  be  done  in  connection  with 
an  industrial  dispute.  In  fact,  it  may  be  said  that  it  de- 
pends almost  entirely  upon  the  personal  opinion  and 
social  ideas  of  the  court  in  whose  jurisdiction  the  acts 
may  occur. 

2.  The  general  effect  of  the  decisions  of  American  courts, 
however,  has  been  to  restrict  the  activities  of  labor  or- 
ganizations and  deprive  them  of  their  most  effective 
weapons,  namely,  the  boycott  and  the  power  of  picketing, 
while  on  the  other  hand  the  weapons  of  employers,  namely, 
the  power  of  arbitrary  discharge,  of  blacklisting,  and  of 
bringing  in  strikebreakers,  have  been  maintained  and 
legislative  attempts  to  restrict  the  employers'  powers 
have   generally   been   declared   unconstitutional   by   the 


136 

courts.  Furthermore,  an  additional  weapon  has  been 
placed  in  the  hands  of  the  employers  by  many  courts  in 
the  form  of  sweeping  injunctions,  which  render  punish- 
able acts  which  would  otherwise  be  legal,  and  also  result 
in  effect  in  depriving  the  workers  of  the  right  to  jury 
trial. 

3.  Important  steps  have  been  taken  to  deal  with  this  situa- 
tion by  the  enactment  of  the  Clayton  Act,  applying  to  the 
Federal  jurisdiction,  and  by  the  passage  of  laws  in  Mas- 
sachusetts and  New  York  which  define  the  rights  of  par- 
ties engaged  in  industrial  disputes.  The  actual  effect  of 
the  Clayton  Act  can  not  be  ascertained  until  it  has  been 
tested  in  the  courts,  but  eminent  legal  authorities  have 
expressed  grave  doubts  that  it  will  accomplish  the  de- 
sired results.  At  any  rate,  it  does  not  seem  to  remove 
the  root  of  the  existing  injustice,  and,  furthermore,  in  all 
the  States  except  New  York  and  Massachusetts  the  grave 
and  uncertain  situation  already  described  exists.  This 
situation  must  be  corrected. 

4.  There  are,  apparently,  only  two  lines  of  action  possible: 
First,  to  restrict  the  rights  and  powers  of  the  employers 
to  correspond  in  substance  to  the  powers  and  rights  now 
allowed  to  trade  unions,  and  second,  to  remove  all  restric- 
tions which  now  prevent  the  freedom  of  action  of  both 
parties  to  industrial  disputes,  retaining  only  the  ordi- 
nary civil  and  criminal  restraints  for  the  preservation  of 
life,  property,  and  the  public  peace.  The  first  method 
has  been  tried  repeatedly  and  has  failed  absolutely,  not 
only  because  of  the  intervention  of  the  courts  but  because 
the  very  nature  of  the  acts  complained  of  on  the  part  of 
employers  (blacklisting  and  arbitrary  discharge)  makes 
it  impossible  to  prevent  them  effectively  by  any  form  of 
legislation  or  administration.  The  only  method  there- 
fore seems  to  be  the  removal  of  all  restrictions  upon 
both  parties,  thus  legalizing  the  strike,  the  lockout,  the 
boycott,  the  blacklist,  the  bringing  in  of  strikebreakers, 


137 

and  peaceful  picketing.  This  has  been  most  successfully 
accomplished  by  the  British  Trades  Disputes  Act,  which 
is  the  result  of  fifty  years  of  legal  evolution,  and  in  its 
present  form  seems  to  work  as  successfully  as  could  pos- 
sibly be  expected. 

It  is  suggested,  therefore,  that  the  Commission  recommend : 

1.  The  enactment  by  Congress  and  the  States  of  legislation 
embodying  the  principles  contained  in  the  British  Trades 
Disputes  Act,  the  text  of  which  is  as  follows: 

An  agreement  or  combination  of  two  or  more  persons 
to  do  or  procure  to  be  done  any  act  in  contemplation  or 
furtherance  of  a  trade  dispute  between  employers  and 
workmen  shall  not  be  indictable  as  a  conspiracy  if  such 
an  act  committed  by  one  person  would  not  be  punishable 
as  a  crime.  An  act  done  in  pursuance  of  an  agreement 
or  combination  by  two  or  more  persons  shall,  if  done  in 
contemplation  or  furtherance  of  a  trade  dispute,  not  be 
actionable  unless  the  act,  if  done  without  any  such  agree- 
ment or  combination,  would  be  actionable. 

An  action  against  a  trade  union,  whether  of  workmen 
or  masters,  or  against  any  members  or  officials  thereof 
on  behalf  of  themselves  and  all  other  members  of  the 
trade  union  in  respect  of  any  tortious  act  alleged  to  have 
been  committed  by  or  on  behalf  of  the  trade  union,  shall 
not  be  entertained  by  any  court. 

An  act  done  by  a  person  in  contemplation  or  further- 
ance of  a  trade  dispute  shall  not  be  actionable  on  the 
ground  only  that  it  induces  some  other  person  to  break 
a  contract  of  employment  or  that  it  is  an  interference 
with  the  trade,  business,  or  employment  of  some  other 
person,  or  with  the  right  of  some  other  person  to  dispose 
of  his  capital  or  his  labor  as  he  wills. 

It  shall  be  lawful  for  one  or  more  persons,  acting  either 
on  their  own  behalf  or  on  behalf  of  a  trade  union  or  of  an 
individual  employer  or  firm  in  contemplation  or  further- 
ance of  a  trade  dispute,  to  attend  at  or  near  a  house  or 


138 

place  where  a  person  resides  or  works  or  carries  on  busi- 
ness or  happens  to  be,  if  they  so  attend  merely  for  the 
purpose  of  peacefully  obtaining  or  communicating  infor- 
mation, or  of  peacefully  persuading  any  person  to  work 
or  abstain  from  working. 

Every  person  who,  with  a  view  to  compel  any  other 
person  to  abstain  from  doing  or  to  do  any  act  which  such 
other  person  has  a  legal  right  to  do  or  abstain  from 
doing,  wrongfully  and  without  legal  authority — 

1.  Uses  violence  to  or  intimidates  such  other  person 
or  his  wife  or  children,  or  injures  his  property;  or, 

2.  Persistently  follows  such  other  person  about  from 
place  to  place;  or, 

3.  Hides  any  tools,  clothes,  or  other  property  owned 
or  used  by  the  other  person,  or  deprives  him  of  or  hin- 
ders him  in  the  use  thereof;  or, 

4.  Watches  or  besets  the  house  or  other  place  where 
such  other  person  resides,  or  works,  or  carries  on  busi- 
ness, or  happens  to  be,  or  the  approach  to  such  a  house 
or  place ;  or, 

5.  Follows  such  other  person  with  two  or  more  other 
persons  in  a  disorderly  manner  in  or  through  any  street 
or  road,  shall  on  conviction  thereof  by  a  court  of  sum- 
mary jurisdiction,  or  an  indictment  as  hereinafter  men- 
tioned, be  liable  either  to  pay  a  penalty  not  exceeding 
twenty  pounds,  or  to  be  imprisoned  for  a  term  not  ex- 
ceeding three  months,  with  or  without  hard  labor. 


139 


IX.     The  Policing  of  Industry. 

The  Commission  has  made  extensive  investigations  and  has 
heard  many  witnesses  upon  this  subject  and  as  a  result  the 
following  conclusions  are  justified: 

1.  The  problem  of  policing  industry  is  generally  conceived 
to  lie  in  the  suppression  of  violence  and  the  protection  of 
life  and  property ;  but  in  reality  consists  in  the  more  fun- 
damental problem  of  protecting  the  rights  of  employ- 
ers and  employees  as  well  as  preserving  the  peace. 


THE  ORIGIN  OF  INDUSTRIAL  VIOLENCE. 

Violence  is  seldom,  if  ever,  spontaneous,  but  arises  from 
a  conviction  that  fundamental  rights  are  denied  and  that 
peaceful  methods  of  adjustment  can  not  be  used.  The 
sole  exception  seems  to  lie  in  the  situation  where,  intoxi- 
cated with  power,  the  stronger  party  to  the  dispute  relies 
upon  force  to  suppress  the  weaker. 

The  arbitrary  suppression  of  violence  by  force  produces 
only  resentment  which  will  rekindle  into  greater  violence 
when  opportunity  offers.  Violence  can  be  prevented  only 
by  removing  the  causes  of  violence ;  industrial  peace  can 
rest  only  upon  industrial  justice. 

The  origin  of  violence  in  connection  with  industrial  dis- 
putes can  usually  be  traced  to  the  conditions  prevailing 
in  the  particular  industry  in  times  of  peace,  or  to  arbi- 
trary action  on  the  part  of  Governmental  officials  which 
infringes  on  what  are  conceived  to  be  fundamental  rights. 
Violence  and  disorder  during  actual  outbreaks  usually 
result  from  oppressive  conditions  that  have  obtained  in 
a  particular  shop  or  factory  or  in  a  particular  industry. 
Throughout  history  where  a  people  or  a  group  have  been 
arbitrarily   denied   rights   which   they   conceived   to   be 


140 

theirs,  reaction  has  been  inevitable.     Violence  is  a  nat- 
ural form  of  protest  against  injustice. 

5.  Violence  in  industrial  disputes  is  not  immediately  the 
product  of  industrial  conditions,  but  of  the  attitude  of  the 
parties  to  the  dispute  after  grievances  or  demands  have 
been  presented.  The  principal  sources  of  an  attitude 
leading  to  violence  are : 

a.  Arrogance  on  the  part  of  the  stronger  party.  This 
may  result  immediately  in  violence  through  the  use 
of  force  for  the  suppression  of  the  weaker  party. 
The  force  used  may  be  physical  or  industrial.  Phys- 
ical force  may  be  and  is  used  by  both  employers  and 
employees,  through  intimidation,  assaults  or  attacks 
on  property.  Such  physical  aggression  is  seldom 
used  by  employees,  as  they  are  strategically  the 
weaker  party  and  the  results  are  negative;  only  un- 
der exceptional  circumstances  can  an  employer  be 
coerced  by  the  use  of  force  or  intimidation.  The  ex- 
ceptions seem  to  lie  in  the  use  of  secret  means,  such 
as  dynamite,  with  the  object  of  weakening  the  em- 
ployer's resistance. 

The  use  of  force  by  workers  is  normally  directed 
not  against  the  person  or  property  of  the  employer, 
but  against  strikebreakers  and  guards.  Many  in- 
stances of  the  use  of  physical  force  by  the  agents  of 
employers  have,  however,  come  before  the  Commis- 
sion, indicating  a  relatively  wide  use,  particularly 
in  isolated  communities.  Such  acts  of  violence  usu- 
ally take  the  form  of  assaults  upon  the  leaders  of  the 
workers  or  upon  organizers. 

The  instruments  of  industrial  force  belong  chiefly 
to  the  employer,  because  of  his  control  of  the  job  of 
the  worker.  Their  use  is  more  common  and  more 
effective  than  any  other  form  of  violence  at  the  com- 
mand of  the  employer.  The  most  powerful  weapon 
is  the  power  of  discharge,  which  may  be  used  indis- 
criminately upon  mere  suspicion,  which  under  cer- 


141 

tain  conditions  may  be  almost  as  potent,  either  in 
use  or  threat,  as  the  power  of  life  and  death.  It  is 
the  avowed  policy  of  many  employers  to  discharge 
any  man  who  gives  any  sign  of  dissatisfaction  on 
the  theory  that  he  may  become  a  trouble  maker  or 
agitator. 

The  only  corresponding  weapon  in  the  hands  of 
the  workers  is  sabotage,  in  the  form  either  of  ma- 
licious destruction  of  property  or  of  interference 
with  production.  The  field  of  its  use  is  much  more 
restricted  in  practice  than  in  theory  and  its  results 
at  best  are  negative  and  produce  in  the  employer 
only  a  blind  resentment  and  undiscriminating  hate. 
Sabotage  as  a  policy  shows  no  signs  of  developing 
in  American  industry. 

Equally  productive  of  an  attitude  leading  to  vio- 
lence is  the  denial  of  the  use  of  peaceful  methods  of 
adjusting  grievances,  or  the  creation  of  a  situation 
in  which  their  use  becomes  impossible. 

On  the  part  of  the  employer  the  arbitrary  acts 

which  may  be  classed  under  this  general  head  are: 

Denial  of  the  right  to  organize. 

Refusal  to  consider  the  complaints  of  workers. 

Refusal  to  meet  the  authorized  representatives 

of  workers. 

Under  modern  industrial  conditions  any  one  of 
these  acts  makes  peaceful  negotiation  and  settlement 
impossible.  Without  organization  of  the  workers 
their  collective  claims  can  not  be  considered;  with- 
out the  right  to  appoint  such  representatives  as  they 
choose,  workers  are  at  the  mercy  of  the  employer's 
power  of  discharge  and  are  usually  unequal  to  the 
task  of  presenting  and  arguing  their  claims;  while 
the  refusal  to  consider  grievances  leaves  only  the  al- 
ternative of  the  strike. 

On  the  part  of  the  workers,  the  possibility  of  peace- 


142 

ful  settlement  may  be  destroyed  by  refusal  to  discuss 
claims,  by  internal  dissensions  which  render  collect- 
ive and  definite  action  looking  to  a  settlement  im- 
possible, and  by  the  issuance  of  ultimata  which  allow 
no.  time  for  consideration  and  negotiation.  In  any 
one  of  these  situations  the  employer  has  only  the 
choice  between  tame  submission  or  absolute  resist- 
ance to  the  demands  of  the  workers. 

The  immediate  cause  of  violence  in  connection  with 
industrial  disputes  is  almost  without  exception  the 
attempt  to  introduce  strikebreakers  to  take  the  place 
of  the  workers  who  have  struck  or  who  are  locked 
out.  The  entire  problem  of  policing  industrial  dis- 
putes grows  out  of  the  problem  of  the  strikebreaker 
and  the  attitude  of  the  State  toward  him. 

All  experience  shows  that  if  no  attempt  is  made 
to  operate  the  plant,  violence  and  disturbances  re- 
quiring the  police  are  practically  unknown,  whereas 
the  attempt  of  strikebreakers  to  reach  hie  plant,  par- 
ticularly where  strikers  are  enjoined  or  prevented 
from  using  reasonable  means  to  inform  them  of  the 
existence  of  the  strike  and  to  use  persuasive  meth- 
ods to  keep  them  from  entering  the  plant,  is  invar- 
iably accompanied  by  disorder  and  sometimes  by 
active  violence. 

The  existing  attitude  of  the  courts  and  of  Govern- 
mental officials  generally  is  that  the  entire  machin- 
ery of  the  State  should  be  put  behind  the  strike- 
breaker. This  attitude  is  based  upon  the  theory  that 
two  important  rights  are  involved — first,  "the  right 
of  the  strikebreaker  to  work,"  and  second,  "the  right 
of  the  employer  to  do  business."  During  earlier 
years,  the  right  of  the  strikebreaker  was  stressed 
by  the  courts,  but  since  the  decision  of  Vice  Chancel- 
lor Stevenson  in  1902  (Jersey  City  Ptg.  Co.  v.  Cas- 
sidy,  53  Atl.  230),  in  which  the  doctrine  was  an- 
nounced as  "recently  recognized,"  the  right  of  the 


143 

employer  to  do  business  has  been  in  favor  appar- 
ently because  of  its  wider  application  and  the  fact 
that  being  denominated  a  property  right,  injunctions 
could  regularly  be  issued  for  its  protection.  Kegard- 
less,  however,  of  their  origin,  both  of  these  so-called 
rights  seem  to  have  been  based  upon  misconceptions 
by  the  courts.  The  " right  to  work"  guaranteed  to 
the  strikebreaker  seems  to  be  based  upon  the  con- 
ception that  the  strikebreaker  is  normally  a  work- 
ingman,  who  seeks  work  and  desires  to  take  the  place 
of  the  striker.  The  fact  is,  practically  without  ex- 
ception, either  that  the  strikebreaker  is  not  a  genuine 
working-man  but  is  a  professional  who  merely  fills 
the  place  of  the  worker  and  is  unable  or  unwilling  to 
do  steady  work,  or,  if  he  is  a  bona  fide  workingman, 
that  he  is  ignorant  of  conditions  or  compelled  to 
work  under  duress.  The  nonworking  character  of 
the  strikebreaker  is  shown  by  the  fact  that  very  few 
are  ever  retained  as  workers  after  the  termination 
of  a  strike,  while  the  attitude  of  genuine  working- 
men  toward  strikebreaking  is  shown  by  the  signifi- 
cant fact  that  in  the  bids  of  employment  agencies 
and  detective  agencies  to  furnish  strikebreakers  it 
is  provided  that  guards  will  be  furnished  with  each 
car  "to  prevent  escape  in  transit,"  and  by  the  fact 
that  when  men  are  candidly  informed  in  the  public 
employment  offices  of  the  existence  of  a  strike,  work- 
ers practically  never  apply  for  such  positions  even 
though  they  may  be  in  dire  want.  -N 

The  second  misconception  is  contained  in  the  idea 
that  the  "right  to  do  business"  is  an  absolute  right. 
Besides  the  fact  that  it  has  only  been  insisted  upon  by 
the  courts  within  the  past  twenty  years  and  has  no 
express  legislative  or  constitutional  sanction  what- 
ever, this  right  is  subject  to  the  most  severe  limita- 
tion and  infringement  even  without  due  process  of 
law.    Not  only  can  the  legislature  limit  the  right  to 


144 

do  business  in  almost  every  conceivable  way,  but 
health  authorities  are  given  power  to  suspend  it  en- 
tirely if  the  public  safety  demands,  as  in  the  case  of 
either  a  human  or  an  animal  epidemic.  Further- 
more, the  courts  can  not  and  will  not  guarantee  in 
any  way  the  "good  will"  which  is  supposed  to  be 
the  property  aspect  of  the  right  to  do  business,  nor 
will  they  assess  damages  on  account  of  any  alleged 
injury  based  upon  the  "probable  expectancy"  of  the 
business. 

The  right  to  do  business  is  in  fact  permitted  only 
so  far  as  its  exercise  is  in  the  public  interest,  and 
it  may  be  restricted  or  prohibited  through  the  po- 
lice power  whenever  it  is  dangerous  or  in  any  way 
deleterious  to  the  public.  This  is  the  reason  under- 
lying not  only  quarantine,  but  every  form  of  regu- 
lation and  prohibition. 

The  plea  of  the  workers  for  the  assumption  of  a 
new  attitude  in  relation  to  strikebreakers  is,  how- 
ever, based  not  only  upon  the  negative  character 
of  the  rights  of  the  employer  and  the  strikebreaker, 
but  upon  a  positive  though  somewhat  undefinable 
demand  for  recognition  that  strikers  have  a  right 
to  the  jobs  which  they  have  left  until  their  griev- 
ances are  in  some  way  adjusted.  The  argument  is 
not  only  that  when  workers  are  willing  to  strike  and 
sacrifice  their  livelihood,  the  conditions  against 
which  they  protest  must  be  assumed  to  be  socially 
injurious,  but,  even  more,  that  the  worker  who  has 
struck  in  support  of  his  demand  for  better  condi- 
tions has  not  abandoned  his  job,  but,  in  fact,  has  a 
keener  interest  in  it  than  when  quietly  submitting 
to  distasteful  conditions. 

At  the  very  basis  of  the  workers'  contentions, 
however,  lies  the  realization  that  working  conditions 
can  be  improved  only  by  strikes  and  that  no  strike 
can  be  won  if  the  employer  can  operate  his  plant 


145 

without  difficulty.  This  is  becoming  increasingly- 
true  with  every  step  in  the  Nation's  industrial  de- 
velopment. During  more  primitive  periods,  if  work- 
ers struck  their  places  could  not  be  filled  except 
through  the  existence  of  a  surplus  of  qualified  labor 
in  the  community  or  by  enticing  workers  from  other 
employers.  Now,  the  development  of  transporta- 
iton,  the  establishment  of  specialized  agencies  for 
supplying  strikebreakers,  and  the  growth  of  large 
corporations  which  can  shift  employees  from  one 
plant  to  another,  have  given  each  employer  a  com- 
mand of  the  labor  market  of  the  entire  country. 
There  are  agencies  in  every  large  city  which  will  con- 
tract to  supply  any  kind  of  labor  on  short  notice, 
while  almost  any  of  the  large  industrial  corporations 
can  either  supply  the  normal  demand  with  one-half 
or  three-quarters  of  their  plants,  or  recruit  from  the 
surplus  labor  around  their  various  plants  a  skele- 
ton organization  which  can  resume  operations  in  a 
short  time. 

The  respective  rights  of  employer,  striker,  and 
strikebreaker  are  matters  which  can  not  be  solved 
by  any  method  of  cold  reasoning,  and  should  not  be 
solved  except  by  the  force  of  public  opinion  acting 
either  directly  or  through  the  medium  of  their  rep- 
resentatives. In  such  matters  we  feel  that  our  ac- 
tion can  extend  no  further  than  the  analysis  of  the 
issues,  the  presentation  of  the  pertinent  facts,  and 
the  expression  of  such  general  opinions  as  we  may 
have  reached. 

We  are  convinced,  however,  that  a  modification 
of  the  legislative  and  judicial  attitude  on  this  ques- 
tion is  necessary,  and  also  that  in  the  minds  of  the 
public  a  more  general  appreciation  of  the  contentions 
of  the  workers  is  already  taking  place. 

A  general  exception  to  this  may  perhaps  exist  in 
the  case  of  public  utilities,  including  not  only  the 


146 

services  which  are  commonly  included,  but  the  sup- 
ply of  milk,  ice,  and  other  similar  necessities.  The 
absolute  dependence  of  the  population  of  modern 
cities  upon  the  noninterruption  of  such  services  has 
created  a  widespread  public  demand  for  action  which 
will  insure  them  under  all  conditions.  The  public 
may  good-humoredly  walk  during  a  street-car  strike, 
but  the  interruption  of  the  supply  of  food,  fuel  and 
ice,  produces  an  attitude  of  public  desperation.  We 
confess  that,  under  present  conditions,  no  absolute 
insurance  against  its  interruption  by  industrial  dis- 
putes seems  practicable.  As  long,  certainly,  as 
these  services  are  performed  by  private  corporations, 
the  right  of  employees  to  strike  should  not  and  can 
not  constitutionally  be  abrogated  or  abridged.  Even 
under  Government  ownership  and  operation,  the 
problem  is  only  slightly  altered  by  the  removal  of  the 
incentive  of  private  profit  for  the  maintenance  of  im- 
proper labor  conditions,  while  cooperative  operation 
is  too  vague  even  for  analysis.  At  present,  proper 
action  seems  to  consist  in  providing,  first,  for  the 
most  effective  possible  means  for  conciliation,  inves- 
tigation and  arbitration;  second,  for  the  use  of  all 
the  leverage  of  public  opinion  to  promote  reasonable- 
ness on  the  part  of  those  involved  in  the  dispute ;  and, 
finally,  for  the  plan  as  outlined  elsewhere  for  defin- 
ing clearly  the  rights  of  the  parties  to  the  dispute 
and  the  impartial  but  firm  enforcement  of  such 
rights. 

d.  The  greatest  disorders  and  most  acute  outbreaks 
of  violence  in  connection  with  industrial  disputes 
arise  from  the  violation  of  what  are  considered  to  be 
fundamental  rights,  and  from  the  perversion  or  sub- 
version of  Governmental  institutions. 

This  source  of  acute  unrest  has  been  discussed  at 
length  in  a  preceding  section  so  that  at  this  point  it  is 
necessary  only  to  summarize  briefly  its  commonest 


147 

manifestations,  and  to  state  that  even  the  limited  in- 
vestigations which  the  Commission  has  been  able  to 
make  show  that  practically  every  industrial  State  has 
at  some  relatively  recent  time  permitted  its  institu- 
tions to  be  used  by  one  party  or  the  other  to  an  indus- 
trial dispute  (almost  without  exception  the  employ- 
ers) in  such  a  way  that  the  rights  of  the  other  party 
were  either  nullified  or  seriously  transgressed. 

It  may  be  said  that  every  Governmental  institution 
and  function  has  been  at  some  time  utilized  by  the 
stronger  industrial  factor  for  the  oppression  and  sup- 
pression of  the  weaker,  but  those  which  are  most  com- 
monly utilized  are,  first,  the  police,  including  not  only 
the  municipal  police,  the  sheriffs  and  deputies,  the 
State  police  and  constabulary  and  the  militia,  but 
the  private  guards,  detectives,  and  vigilante  organiza- 
tions which  usurp  and  exercise  the  functions  of  the 
police.  The  biased  action  of  the  State  and  municipal 
police  seldom  extends  beyond  the  making  of  unwar- 
ranted arrests,  the  enforcement  of  unreasonable  rules 
regarding  such  matters  as  picketing  and  public  as- 
semblage, and  the  use  of  excessive  brutality.  The 
State  and  municipal  police  are  uniformly  paid  by  the 
public  and  such  control  over  their  action  as  exists 
is  generally  indirect.  In  the  case  of  the  other  bodies 
mentioned  the  control  is  frequently  direct  and  their 
action  frankly  and  bitterly  partisan.  The  sheriffs  in 
many  counties  deputize  guards  in  the  employment 
and  pay  of  corporations,  without  any  qualifications 
and  sometimes  even  without  knowing  their  names. 
Similarly  the  militia  are  at  times  recruited  from  the 
guards  and  other  employees  of  corporations.  The 
private  guards,  detectives,  and  vigilantes  are  openly 
partisan  and  can  have  no  other  purpose  in  connec- 
tion with  a  strike  than  to  break  it  with  such  means  as 
they  can  command. 

The  police  would,  however,  be  much  less  effective  if 


148 

their  control  in  a  given  locality  did  not  usually  imply 
also  control  of  all  or  part  of  the  local  courts  to  give  a 
legal  sanation  to  lawlessness,  to  protect  those  who  are 
criminally  liable,  and  to  exercise  their  full  rigor  in 
the  prosecution  of  the  strikers.  Such  controlled 
courts  have  not  only  found  it  possible  through  the 
use  of  blanket  injunctions  to  make  illegal  acts  which 
would  otherwise  be  legal,  but,  resting  upon  their  pro- 
tection, the  police,  the  deputies,  the  militia  and  the 
private  guards  have  in  many  cases  felt  free  to  go  to 
unbelievable  lengths  in  order  to  carry  out  their  plans. 

The  subserviency  of  the  courts  in  many  parts  of 
the  country  can  not  be  more  clearly  shown  than  by 
the  fact  that  they  have  time  and  again  permitted  the 
militia,  under  color  of  so-called  "martial  law,"  to 
usurp  their  functions  and  to  defy  their  associations 
who  resisted  the  encroachment.  The  situation  is  ac- 
centuated also  by  the  fact  that  the  decisions  of  such 
corrupt  and  subservient  courts  become  the  basis  upon 
which  later  honest  "record  worshiping"  judges  form 
their  own  opinions.1 

When  Governmental  institutions  are  thus  corrupt- 
ed and  used  as  instruments  of  oppression  men  can 
only  resist  with  such  power  as  they  have,  not  alone 
for  the  protection  of  themselves  and  their  families 
but  for  the  preservation  of  the  fundamental  rights  of 
themselves  and  their  fellow-citizens.  Resistance  to 
the  usurpers  of  Governmental  power  and  to  those 
who  pervert  to  base  uses  the  official  power  with  which 
they  are  clothed,  was  made  the  keystone  of  the  Amer- 
ican Nation,  and  Abraham  Lincoln,  on  a  most  sol- 
emn occasion  said: 

"If  by  the  mere  force  of  numbers  a  majority  should 
deprive  a  minority  of  any  clearly  written  constitu- 
tional right,  it  might,  in  a  moral  point  of  view,  justify 


1 — See  report  of  B.  F.  Moore — Application  of  Writ  of  Habeas  Corpus  in  Labor 
and  Nonlabor  cases. 


149 

revolution — certainly  would  if  such  a  right  were  a 
vital  one."1 

The  grave  danger  in  the  United  States  is  that  on 
account  of  the  enormous  area  and  the  sense  of  isola- 
tion of  each  section  as  regards  the  others,  the  en- 
croachment upon  fundamental  rights  and  the  subver- 
sion of  local  governments  will  be  permitted  to  gain 
ground  without  the  effective  protest  of  the  entire  Na- 
tion until  the  liberties  of  all  citizens  are  hanging  in 
the  balance. 


STATE  CONSTABULARY. 

The  Commission  devoted  a  great  deal  of  attention  to  the 
question  of  a  State  constabulary  as  a  method  of  policing 
industry.  Extensive  investigations  of  the  organization, 
personnel,  and  activities  of  the  Pennsylvania  State  Con- 
stabulary were  made  and  a  number  of  witnesses  were 
heard  at  length.  The  findings  with  regard  to  this  particu- 
lar police  organization  may  be  briefly  stated:  It  is  an 
extremely  efficient  force  for  crushing  strikes,  but  it  is  not 
successful  in  preventing  violence  in  connection  with 
strikes,  in  maintaining  the  legal  and  civil  rights  of  the 
parties  to  the  dispute,  nor  in  protecting  the  public.  On 
the  contrary,  violence  seems  to  increase  rather  than 
diminish  when  the  constabulary  is  brought  into  an  indus- 
trial dispute;  the  legal  and  civil  rights  of  the  workers 
have  on  numerous  occasions  been  violated  by  the  constab- 
ulary ;  and  citizens  not  in  any  way  connected  with  the  dis- 
pute and  innocent  of  any  interference  with  the  constab- 
ulary have  been  brutally  treated  and  in  one  case  shot 
down  by  members  of  the  constabulary,  who  have  escaped 
punishment  for  their  acts.  Organized  upon  a  strictly  mili- 
tary basis,  it  appears  to  assume  in  taking  the  field  in  con- 
nection with  a  strike,  that  the  strikers  are  its  enemies  and 


1 — Inaugural  address,  March  4,  1861. 


150 

the  enemies  of  the  State,  and  that  a  campaign  should  be 
waged  against  them  as  such. 

There  are  certain  features  of  the  State  police  system, 
however,  which  seem  to  be  preferable  to  the  present  hap- 
hazard methods  of  policing  strikes.  It  is  desirable,  first, 
that  all  kinds  of  police  should  receive  their  entire  compen- 
sation from  the  State.  Second,  an  organized  force,  whose 
records  are  known,  is  preferable  both  to  the  private  police 
of  corporations  and  to  the  deputies  ordinarily  sworn  in 
by  sheriffs.  Third,  it  is  desirable  that  the  force  should 
be  strictly  disciplined  and  subject  to  definite  orders. 
Fourth,  it  is  desirable  that  those  in  command  of  any  po- 
lice force  should  have  a  reasonably  secure  tenure  of  office 
and  should  have  had  previous  experience  under  similar 
circumstances,  as  an  inexperienced  person  is  likely  to  be- 
come panic  stricken  by  the  mere  presence  of  crowds,  re- 
gardless of  their  actions. 

If  these  desirable  features  could  be  combined  with 
other  features  which  would  insure  their  impartiality  dur- 
ing industrial  disputes,  and  raise  their  ideals  from  the 
present  militaristic  basis  to  the  police  basis  of  preserv- 
ing the  peace  and  protecting  the  rights  of  both  parties 
and  the  public,  the  establishment  of  State  police  systems 
for  use  in  connection  with  industrial  disputes  might  be 
recommended.  But  under  present  conditions,  it  seems 
desirable  rather  to  leave  the  State  policing  of  industrial 
disputes  to  the  sheriffs  and  the  militia  if  the  restrictions 
hereinafter  suggested  are  rigidly  enforced  so  as  to  pro- 
tect both  the  organization  and  the  personnel  from  parti- 
sanship. 

FREE  SPEECH. 

7.  One  of  the  greatest  sources  of  social  unrest  and  bitter- 
ness has  been  the  attitude  of  the  police  toward  public 
speaking.  On  numerous  occasions  in  every  part  of  the 
country,  the  police  of  cities  and  towns  have  either  arbi- 
trarily or  under  the  cloak  of  a  traffic  ordinance,  inter- 


151 

fered  with  or  prohibited  public  speaking,  both  in  the  open 
and  in  halls,  by  persons  connected  with  organizations  of 
which  the  police  or  those  from  whom  they  received  their 
orders  did  not  approve.  In  many  instances  such  interfer- 
ence has  been  carried  out  with  a  degree  of  brutality  which 
would  be  incredible  if  it  were  not  vouched  for  by  reliable 
witnesses.  Bloody  riots  frequently  have  accompanied 
such  interference  and  large  numbers  of  persons  have  been 
arrested  for  acts  of  which  they  were  innocent  or  which 
were  committed  under  the  extreme  provocation  of  brutal 
treatment  of  police  or  private  citizens. 

In  some  cases  this  suppression  of  free  speech  seems  to 
have  been  the  result  of  sheer  brutality  and  wanton  mis- 
chief, but  in  the  majority  of  cases  it  undoubtedly  is  the 
result  of  a  belief  by  the  police  or  their  superiors  that  they 
were  " supporting  and  defending  the  Government"  by 
such  an  invasion  of  personal  rights.  There  could  be  no 
greater  error.  Such  action  strikes  at  the  very  founda- 
tions of  Government.  It  is  axiomatic  that  a  Government 
which  can  be  maintained  only  by  the  suppression  of  criti- 
cism should  not  be  maintained.  Furthermore,  it  is  the 
lesson  of  history  that  attempts  to  suppress  ideas  results 
only  in  their  more  rapid  propagation. 

Not  only  should  every  barrier  to  the  freedom  of  speech 
be  removed,  as  long  as  it  is  kept  within  the  bounds  of  de- 
cency and  as  long  as  the  penalties  for  libel  can  be  invoked, 
but  every  reasonable  opportunity  should  be  afforded  for 
the  expression  of  ideas  and  the  public  criticism  of  social 
institutions.  The  experience  of  Police  Commissioner 
Woods  of  New  York  City,  as  contained  in  his  testimony 
before  this  Commission,  is  convincing  evidence  of  the  good 
results  which  follow  such  a  policy.  Mr.  Woods  testified 
that  when  he  became  Commissioner  of  Police,  he  found 
in  force  a  policy  of  rigid  suppression  of  radical  street 
meetings,  with  the  result  that  riots  were  frequent  and 
bitter  hatred  of  the  police  was  widespread.  He  adopted 
a  policy  of  not  only  permitting  public  meetings  at  all 


152 

places  where  traffic  and  the  public  convenience  would  not 
be  interfered  with,  but  instructing  the  police  to  protect 
speakers  from  molestation;  as  a  result,  the  rioting  en- 
tirely ceased,  the  street  meetings  became  more  orderly 
and  the  speakers  were  more  restrained  in  their  utterances. 
It  is  suggested  that  the  Commission  recommend  as 
measures  designed  not  only  to  remove  the  causes  which 
lead  to  violence  but  to  promote  the  impartial  and  effective 
action  of  police  during  disputes : 

1.  The  enactment  by  Congress  of  a  statute  prohibiting, 
under  severe  penalties,  the  transportation  of  men 
from  State  to  State  either  under  arms  or  for  the  pur- 
pose of  arming  them  as  guards  or  as  agents  either 
of  employers  or  of  employees. 

2.  The  enactment  by  Congress  of  a  statute  prohibiting 
the  shipment  in  interstate  commerce  of  cannon,  gat- 
ling  guns,  and  other  guns  of  similar  character,  which 
are  not  capable  of  personal  use,  when  consigned  to 
anyone  except  military  agencies  of  the  JState  or  Fed- 
eral Governments. 

3.  The  regulation  or  prohibition  of  private  detective 
agencies  and  private  employment  agencies  as  here- 
inbefore suggested. 

4.  The  strict  enforcement  in  all  public  and  private  em- 
ployment offices  of  the  rules  requiring  full  notice  of 
the  existence  of  a  strike. 

5.  The  complete  assumption  by  the  States  and  munici- 
palities of  the  responsibility  for  policing,  and  the 
prohibition  of  the  maintenance  of  any  private  police 
(except  a  limited  number  of  watchmen  without  police 
power  except  on  premises). 

6.  The  definition  by  statute,  by  the  States,  of  the  condi- 
tions under  which  sheriffs  may  deputize,  such  regu- 


153 

lations  to  include  provisions  that  a  deputy  must  be  a 
bona  fide  resident  of  the  State,  that  a  sworn  state- 
ment of  the  complete  activities  of  each  deputy  cover- 
ing a  period  of  ten  years  immediately  preceding  his 
deputization  shall  be  filed  with  the  Secretary  of  State, 
that  no  person  who  shall  have  been  convicted  of  any 
misdemeanor  or  who  shall  have  been  imprisoned  in 
any  State  shall  be  deputized,  and  that  no  deputy  shall 
receive  any  money  or  any  other  thing  of  value  from 
any  person  connected  with  an  industrial  dispute  dur- 
ing his  period  of  service  or  in  connection  therewith. 

The  enactment  of  statutes,  by  the  States,  providing  a 
uniform  code  governing  the  militia  and  embodying 
the  following  principles : 

a.  A  proclamation  of  martial  law  or  a  state  of  war, 
insurrection  or  rebellion,  by  the  Governor  of  a 
State,  as  the  result  of  an  industrial  dispute,  shall 
have  no  effect  upon  the  continuance  of  the  consti- 
tutional guarantees  of  the  State  and  Federal  con- 
stitutions, nor  upon  the  law  and  statutes,  nor  upon 
the  jurisdiction  of  the  courts,  nor  upon  other  civil 
authorities. 

b.  The  writ  of  habeas  corpus  or  other  process  of  the 
courts  can  not  be  suspended,  interfered  with  nor 
disregarded  by  the  military.  It  is  part  of  the  duty 
of  the  military  to  assist  in  enforcing  the  process 
and  decrees  of  the  civil  courts.  % 

c.  The  ordinary  courts  shall  have  exclusive  jurisdic- 
tion for  the  punishment  of  crime,  and  in  all  cases 
where  the  same  act  constitutes  an  indictable  of- 
fense under  both  military  and  criminal  law,  court- 
martials  shall  have  no  jurisdiction  nor  authority 
to  try  officers  or  soldiers  accused  thereof,  but  the 
offender  shall  be  turned  over  to  the  civil  magis- 
trate for  trial. 


154 

d.  The  military  may  not  hold,  detain,  nor  imprison 
persons  arrested  by  them  any  longer  than  is  neces- 
sary to  hand  them  over  to  the  civil  authorities. 
No  person  arrested  by  the  militia  shall  be  detained 
after  noon  of  the  following  day,  without  being 
brought  before  a  committing  magistrate. 

e.  The  military  may  not  forcibly  enter  nor  search  a 
private  house  in  order  to  seize  arms  or  other  prop- 
erty concealed  therein  without  a  search  warrant. 

f.  The  military  shall  have  no  authority  to  establish 
a  censorship  over  the  press  nor  to  interfere  with 
the  publication  of  newspapers,  pamphlets,  hand- 
bills, or  the  exercise  of  the  right  of  free  speech,  ex- 
cept under  process  of  the  courts. 

g.  The  military  shall  not  limit,  restrict,  nor  inter- 
fere with  the  freedom  of  movement  of  peaceable 
citizens  or  the  rights  of  public  meeting,  assemblage, 
or  parades  in  streets  and  public  highways  or  else- 
where, except  under  due  process  of  law. 

h.  Every  military  officer  under  whose  orders  a 
civilian  is  arrested  shall  within  twenty-four  hours 
thereafter  report  in  writing  to  the  commanding  of- 
ficer the  name  of  the  prisoner,  the  offense  with 
which  he  is  charged,  and  what  disposition  has  been 
made  of  him.  Failing,  he  shall  be  liable  to  such 
punishment  as  a  court-martial  may  direct. 

i.  In  times  of  industrial  disputes  no  private  guards, 
detectives,  nor  employees  of  either  of  the  contend- 
ing parties  shall  be  enlisted  or  employed  as  mem- 
bers of  the  militia,  and  all  persons  found  by  the 
commanding  officer  to  be  in  the  employment  of 
either  party  to  a  dispute  or  actuated  by  animosity 
or  personal  ill-will  toward  either  of  the  contending 
parties,  shall  be  forthwith  released  from  active 
service. 


155 

j.  The  Governor  may,  in  times  of  disturbance,  by 
proclamation  forbid  the  sale  or  transportation  of 
firearms,  ammunition,  and  intoxicating  liquors,  and 
may  require  all  firearms  and  other  weapons  to  be 
deposited  with  the  military  at  certain  places,  re- 
ceipts being  given  therefor.  Proper  search  war- 
rants may  be  issued  to  discover  concealed  weapons. 

That  the  States  and  municipalities  should  provide  by 
law  for  the  fullest  use  of  schools  and  other  public 
buildings  for  public  meetings  and  lectures  and  for 
other  similar  purposes. 


156 


X.        The     Conditions     and     Problems     of     Migratory 

Laborers. 

It  has  been  found  as  a  result  of  the  Commission's  investi- 
gations, which  were  made  chiefly  by  Mr.  P.  A.  Speek: 

1.  There  are  large  numbers  of  American  workers,  in  all  prob- 
ability several  millions,  who  are  not  definitely  attached 
either  to  any  particular  locality  or  to  any  line  of  industry. 
These  migratory  workers  are  continually  moving  from 
one  part  of  the  country  to  another  as  opportunity  for  em- 
ployment is  presented. 

The  great  movements  of  these  workers  are  seasonal  in 
character,  as,  for  example,  the  movement  of  harvest  hands 
during  the  summer  and  autumn,  the  movement  to  the 
lumber  and  ice  camps  in  the  winter,  and  the  movement 
to  the  construction  camps  in  the  spring  and  summer.  In 
addition  there  are  large,  irregular  movements  of  labor- 
ers which  are  produced  by  the  depression  in  different 
trades  and  localities,  and  movements  due  to  false  rumors 
about  opportunities  and  to  the  men's  acquired  habits  of 
migration. 

2.  The  number  of  these  migratory  workers  seems  to  be  in- 
creasing not  only  absolutely  but  relatively.  There  are  no 
available  figures  to  show  this  conclusively,  but  it  is  the 
general  opinion  of  students  of  the  subject  and  of  the 
migratory  workers  themselves  that  a  rapid  increase  in 
their  number  is  taking  place. 

3.  A  considerable  proportion  of  these  migratory  workers  are, 
unquestionably,  led  to  adopt  this  kind  of  a  life  by  reason 
of  personal  characteristics  or  weaknesses,  and  these  per- 
sonal weaknesses  are  accentuated  rather  than  diminished 
by  the  conditions  under  which  they  live  and  work.  Nev- 
ertheless, even  if  the  migratory  workers  were  all  men  of 
the  highest  character  and  reliability,  there  would  still  be 


157 

a  demand  from  our  industries  for  the  movement  of  the 
population  in  almost  as  great  numbers  as  at  present,  in 
order  to  supply  seasonal  demands  and  to  take  care  of  the 
fluctuations  of  business. 

An  increasingly  large  number  of  laborers  go  downward 
instead  of  upward.  Young  men,  full  of  ambition  and  high 
hopes  for  the  future,  start  their  life  as  workers,  but  meet- 
ing failure  after  failure  in  establishing  themselves  in  some 
trade  or  calling,  their  ambitions  and  hopes  go  to  pieces, 
and  they  gradually  sink  into  the  ranks  of  migratory  and 
casual  workers.  Continuing  their  existence  in  these  ranks, 
they  begin  to  lose  self-respect  and  become  "hoboes." 
Afterwards,  acquiring  certain  negative  habits,  as  those 
of  drinking  and  begging,  and  losing  all  self-control,  self- 
respect,  and  desire  to  work,  they  become  "down-and- 
outs" — tramps,  bums,  vagabonds,  gamblers,  pickpockets, 
yeggmen,  and  other  petty  criminals — in  short,  public  para- 
sites, the  number  of  whom  seems  to  be  growing  faster 
than  the  general  population. 

The  movement  of  these  migratory  workers,  at  the  present 
time,  is  practically  unorganized  and  unregulated.  Work- 
men in  large  numbers  go  long  distances  in  the  hope  of 
finding  employment  on  the  basis  of  a  mere  rumor,  and 
frequently  find  that  there  is  either  no  work  or  work  for 
only  a  few.  At  the  same  time,  the  demand  for  labor  in 
a  given  locality  or  industry  remains  unfilled,  because  the 
workers  have  failed  to  hear  of  the  opportunity.  In  fact, 
a  large  part  of  the  movement  of  migratory  workers  at 
present  is  determined  not  by  the  demands  of  industry  for 
labor,  but  by  the  necessity  to  search  for  work.  To  illus- 
trate :  A  man  finds  himself  out  of  work  in  a  given  local- 
ity, because  of  the  termination  of  the  busy  season,  because 
of  business  depression,  or  because  of  his  personal  dis- 
charge ;  he  is  unable  to  secure  employment  in  the  locality, 
and  he  has  no  information  regarding  opportunity  for 
work  elsewhere.    If  he  remains  in  the  locality  he  is  almost 


158 

certain  to  be  arrested  as  a  vagrant.  His  only  recourse  is 
to  start  moving,  and  the  direction  of  the  movement  is 
usually  determined  by  chance. 

6.  The  attempts  to  regulate  the  movements  of  migratory 
workers  by  local  organizations  have,  without  exception, 
proved  failures.  This  must  necessarily  be  true  no  matter 
how  well  planned  or  well  managed  such  local  organiza- 
tions may  be. 

7.  The  problem  can  not  be  handled  except  on  a  national  scale 
and  by  methods  and  machinery  which  are  proportioned 
to  the  enormous  size  and  complexity  of  the  problem. 

The  basic  industries  of  the  country,  including  agricul- 
ture and  railroad  construction  work,  are  absolutely  de- 
pendent upon  these  migratory  workers. 

8.  The  conditions  under  which  migratory  workers  live,  both 
in  the  cities  and  at  their  places  of  employment,  are  such 
as  to  inevitably  weaken  their  character  and  physique,  to 
make  them  carriers  of  disease,  and  to  create  in  them  a 
habit  of  unsteadiness  and  migration. 

The  provisions  for  housing  and  feeding  workers  in  the 
labor  camps  are  subject  to  severe  criticism,  while  the  lodg- 
ing houses  in  the  large  cities  are  even  worse,  especially 
from  the  viewpoint  of  morals.  One  season  spent  in  a  city 
lodging  house  is  generally  sufficient  to  weaken  the  phy- 
sique and  destroy  the  moral  fiber  of  even  the  strongest 
man.  Numerous  instances  of  the  spread  of  dangerous 
diseases  by  migratory  workers  also  have  been  brought 
to  the  notice  of  the  Commission. 

9.  The  available  information  indicates  clearly  that  even  the 
most  perfect  distribution  of  workers,  in  accordance  with 
the  opportunities  afforded  at  present  by  American  in- 
dustries, will  still  leave  enormous  numbers  unemployed 
during  certain  seasons  of  the  year  and  during  periods  of 
industrial  depression. 


159 

10.  The  congregation  of  large  numbers  of  migratory  workers 
in  large  cities  during  the  winter  should  be  avoided,  if  pos- 
sible, not  only  because  they  are  an  unjust  burden  upon 
the  cities  but  because  of  the  degenerating  effects  of  city 
life  during  long  periods  of  idleness. 

11.  The  movement  of  migratory  and  seasonal  workers  is 
caused  chiefly  by  the  seasonal  demand  of  industries  and 
by  the  men's  search  for  work,  and,  to  a  degree,  by  their 
aimless  desire  to  move  about.  The  conditions  of  their 
transportation  have  become  grave.  Millions  of  men  an- 
nually have  to,  and  are  allowed  to,  resort  to  such  a  method 
of  movement  as  stealing  rides  on  the  railways.  This 
method  of  transportation  results  in  the  demoralization 
and  casualization  of  workers,  in  their  congestion  in  indus- 
trial and  railway  centers,  in  waste  of  their  time  and  en- 
ergy, in  frequent  bodily  injuries  and  numerous  fatal  ac- 
cidents and  homicides  annually,  while,  at  the  same  time, 
it  serves  but  poorly  the  industrial  demand  for  help. 

12.  When  the  workers  return  to  the  city,  from  labor  camps, 
for  instance,  either  to  rest  or  to  spend  the  time  between 
seasons,  they  not  only  meet  the  unhealthy  and  demoral- 
izing influence  of  cheap  lodging  houses,  saloons,  houses 
of  prostitution,  and  other  similar  establishments  in  the 
slums,  but  they  fall  easy  prey  to  gamblers,  small  private 
bankers,  and  all  sorts  of  parasites.  As  a  result,  what 
earnings  they  have  left  after  deduction  of  their  living  ex- 
penses at  work  places,  rapidly  disappear,  no  matter  how 
large  these  earnings  may  be. 

The  principal  recommendations  for  dealing  with  the  prob- 
lem of  migratory  workers  are  outlined  under  the  head  of  un- 
employment. In  this  immediate  connection,  however,  it  seems 
desirable  to  suggest  three  necessary  measures : 

1.  The  Interstate  Commerce  Commission  should  be  directed 
by  Congress  to  investigate  and  report  the  most  feasible 


160 

plan  of  providing  for  the  transportation  of  workers  at 
the  lowest  reasonable  rates  and,  at  the  same  time,  meas- 
ures necessary  to  eliminate  the  stealing  of  rides  on  rail- 
ways. 

If  special  transportation  rates  for  workers  are  pro- 
vided, tickets  may  be  issued  only  to  those  who  secure  em- 
ployment through  public  employment  exchanges. 

2.  The  establishment  by  States,  municipalities  and,  through 
the  Department  of  Labor,  the  Federal  Government,  of 
sanitary  workingmen's  hotels  in  which  the  prices  for  ac- 
commodation shall  be  adjusted  to  the  cost  of  operation. 
If  such  workingmen's  hotels  are  established,  the  Post  Of- 
fice Department  should  establish  branch  Postal  Savings 
Banks  in  connection  therewith. 

3.  The  establishment  by  the  municipal,  State  and  Federal 
Governments  of  colonies  or  farms  for  M down-and-outs' * 
in  order  to  rehabilitate  them  by  means  of  proper  food, 
regular  habits  of  living,  and  regular  work  that  will  train 
them  for  lives  of  usefulness.  Such  colonies  should  pro- 
vide for  hospital  treatment  of  cases  which  require  it. 


161 


XI.     Unemployment. 

The  extent  and  character  of  unemployment  has  been  briefly 
presented  in  a  previous  section,  but  the  discussion  there  dealt 
only  with  the  larger  aspects  of  the  situation  in  general  terms. 
It  remains  to  present  at  this  point,  in  summary  fashion,  the 
findings  which  have  resulted  from  the  extensive  investigations 
which  have  been  conducted  for  the  Commission,  principally 
under  the  direction  of  Dr.  William  M.  Leiserson,  together  with 
certain  specific  recommendations  relating  to  the  organization 
of  the  labor  market  and  the  regularization  of  employment. 


EXTENT  AND  CHARACTER  OF  UNEMPLOYMENT. 

1.  Wage  earners  in  the  principal  manufacturing  and  mining 

industries  in  the  United  States  lose  on  the  average  from 
one-fifth  to  one-fourth  of  the  working  time  during  the  nor- 
mal year. 

This  is  the  conclusion  indicated  by  an  examination  of 
practically  all  of  the  published  material,  and  of  the  hear- 
ings of  the  Commission,  relating  to  loss  of  time,  irregu- 
larity of  employment,  and  unemployment. 

2.  Excluding  the  extremely  seasonal  industries,  such  as  can- 

ning, harvesting,  lumber  cutting  and  logging,  which  op- 
erate normally  only  a  part  of  the  year,  the  amount  of  lost 
working  time  varies  greatly  for  workers  in  different  in- 
dustries and  in  different  occupations  and  trades.  Lx>ss  of 
time  appears  to  be  greatest  in  bituminous  coal  mining, 
iron  and  steel  manufacturing,  leather,  woolen  and  worsted 
clothing,  slaughtering  and  meat  packing,  and  in  other  in- 
dustries where  the  proportion  of  unskilled  labor  is  large. 

">.  It  has  been  found  that  the  lowest-paid  worker  is  subject  to 
the  greatest  loss  in  working  time,  not  simply  because  he 
is  unskilled  but  also  because  he  is  poorly  nourished  and 


162 

weakened  by  the  effects  of  unfavorable  conditions  of  liv- 
ing and,  in  many  instances,  by  unbearably  severe  condi- 
tions of  work. 

The  tendency  in  the  evolution  of  modern  industry  to- 
ward the  employment  of  a  larger  proportion  of  unskilled 
labor,  as  well  as  the  fact  that  many  industries  have  come 
into  existence  because  of  the  availability  of  a  supply  of 
casual  laborers  and  of  woman  and  child  workers  who  are 
willing  to  work  for  less  than  subsistence  wages,  points 
to  a  greater  degree  of  irregularity  of  employment,  un- 
employment, and  loss  of  working  time,  than  ever  before. 

The  actual  number  or  proportion  of  workers  at  any  given 
time  who  are  unable  to  work  can  not  be  estimated,  because 
of  the  lack  of  adequate  data  in  this  country.  Recent  in- 
vestigations by  Federal  authorities  and  the  statements  of 
competent  authorities  before  the  Commission,  however, 
prove  beyond  doubt  that  the  number  of  unemployed  per- 
sons even  in  normal  times  is  appallingly  great.  The  sta- 
tistics of  highly  organized  trades  showT  that  even  in  times 
of  greatest  industrial  activity  there  is  a  considerable  per- 
centage, ranging  from  seven  to  fifteen  per  cent  of  all  of 
the  members  of  unions  in  different  trades  and  indus- 
tries, of  workers  who  are  unemployed  during  the  year. 
In  any  year  the  unemployed  who  congregate  in  the  large 
cities  alone  during  the  winter  months  number  several  hun- 
dred thousand,  while  in  years  of  industrial  depression  the 
number  of  unemployed  in  the  entire  country  is  at  least 
three  millions. 

The  loss  in  working  time  is  of  two  principal  classes :  Lack 
of  work  and  sickness.  Lack  of  work,  which  may  mean  the 
inability  of  the  worker  to  find  employment  as  well  as  the 
absence  of  a  demand  for  labor  of  any  particular  kind  or 
even  of  all  kinds,  either  in  a  locality  or  section  or  in  the 
country  as  a  whole,  accounts  for  approximately  two-thirds 
of  the  average  worker's  loss  of  time  at  work,  according 
to  the  available  data  on  this  point;  ill  health,  according  to 


163 

several  intensive  investigations  of  wage  workers  and  their 
families  and  the  examination  of  the  sick  records  of  nearly 
a  million  wage  earners  in  this  country,  accounts  for  ap- 
proximately one-fourth  of  the  loss  in  working  time. 
Strikes  appear  to  be  the  cause  of  less  than  two  per  cent 
of  the  loss  in  working  time,  and  accidents  are  the  cause  in 
about  the  same  proportion. 

In  addition  to  the  two  basic  causes  of  unemployment — 
unjust  distribution  of  income  and  land  monopolization — 
which  were  analyzed  in  detail  in  an  earlier  section  of  the 
report,  the  following  causes  demand  attention : 

a.  Evolutionary  changes  in  industry  and  in  social 
habits  and  movements  which  affect  the  character  and 
the  extent  of  the  demand  for  labor  as  well  as  the 
character  and  the  quantity  of  the  supply  of  labor. 
These  include  changes  in  industrial  structure  and 
methods — such  as  the  increase  or  decrease  in  the  de- 
mand for  labor  in  certain  industries  and  localities,  the 
introduction  of  machinery  and  new  processes,  and  the 
changes  in  the  character  of  the  demand  for  labor — 
and  changes  in  the  organization  of  industry.  The 
character  and  quantity  of  the  supply  of  labor  have 
been  affected  by  immigration  and  by  the  entrance  into 
industry  of  women  workers,  both  of  which  factors 
have  caused  an  increase  in  the  supply  of  cheap  and 
unskilled  labor.  To  some  extent,  however,  the  labor 
supply  is  fluid  because  of  the  ease  with  which  con- 
siderable proportions  of  immigrants  can  withdraw 
from  the  labor  market  by  returning  to  their  homes  in 
times  of  industrial  inactivity. 

b.  Variations  in  the  demand  for  labor  due  to  fluctua- 
tions and  irregularities  in  industry.  Industrial  fluc- 
tuations may  be  classed  as  cyclical  and  seasonal. 
Cyclical  fluctuations  result  from  business  depressions 
and  at  times  double  the  amount  of  loss  of  time  during 
a  year,  which  is  illustrated  by  the  fact  that  the  rail- 


164 

roads  employed  236,000  fewer  men  in  1908  than  in 
1907.  Seasonal  fluctuations  may  either  be  inappre- 
ciable, as  in  municipal  utilities,  or  may  displace 
nearly  the  entire  labor  force.  The  seasonal  fluctua- 
tions in  the  canning  industry  in  California,  for  ex- 
ample, involve  nearly  nine-tenths  of  all  the  workers ; 
in  logging  camps,  which  depend  upon  the  snow,  op- 
erations are  practically  suspended  in  summer;  while 
in  the  brick  and  tile  industry  only  36.5  per  cent  of  the 
total  number  of  employees  are  retained  during  the 
dull  season.  Irregularities  in  the  conduct  of  industry 
and  in  the  method  of  employing  labor  are  evident  in 
dock  work,  in  the  unskilled  work  in  iron  and  steel, 
and  in  slaughtering  and  meat  packing;  in  the  com- 
petitive conditions  in  industries  which  force  employ- 
ers to  cut  labor  cost  down  to  the  utmost  and  to  close 
down  in  order  to  save  operating  expenses ;  in  specu- 
lative practices  which  result  in  the  piling  up  of  or- 
ders and  alternate  periods  of  rush  production  and 
inactivity;  in  loss  of  time  due  to  inefficient  manage- 
ment within  plants.  In  some  cases  it  has  been  charged 
although  without  definite  proof,  that  irregularity  of 
employment  is  due  to  a  deliberate  policy  of  employ- 
ers in  order  to  lessen  the  chance  of  organized  move- 
ment, as  well  as  to  keep  the  level  of  wages  down  in  un- 
skilled occupations  by  continually  hiring  new  indi- 
viduals. 

Conditions  determining  the  worker 's  ability  to  grasp 
or  retain  the  opportunity  to  be  employed  which  in- 
dustry offers.  Among  these  conditions  are  ill-health, 
old  age,  deficiencies  in  industrial  training,  lack  of 
facilities  by  which  the  worker  and  the  job  can  be 
brought  together,  factors  causing  immobility  in  the 
labor  supply  and  its  inability  to  adjust  itself  to 
changes  in  the  character  of  the  demand  for  labor,  and 
those  personal  factors,  such  as  dishonesty,  laziness, 
intemperance,  irregularity,  shiftlessness  and  stupid- 


165 

ity,  which  are  commonly  included  under  the  term 
''deficiencies  of  character."  By  no  means  are  all  of 
these  conditions  under  the  control  of  the  worker;  in 
fact,  the  further  investigation  goes,  the  greater  ap- 
pears the  responsibility  which  society  and  the  em- 
ployer bear  for  the  conditions  that  determine  the 
worker's  ability  to  retain  whatever  employment  in- 
dustry is  able  to  offer  regularly. 

7.  The  effects  of  the  loss  in  working  time,  and  the  attendant 
irregularity  of  employment,  may  be  summed  up  in  the 
term  "the  workers'  economic  insecurity."  Specifically 
the  effects,  as  shown  by  a  study  of  the  results  of  various 
investigations  and  by  testimony  before  the  Commission, 
may  be  summarized  as  follows: 

a.  Actual  loss  of  earnings,  which  in  turn  results  in  the 
necessity  for  the  supplementing  of  family  income  by 
the  earnings  of  women  and  children  and  by  payments 
from  boarders  and  lodgers  whose  presence  is  inimical 
to  family  life. 

b.  The  depression  of  the  wage  level,  in  some  instances, 
and  the  preventing  of  higher  wages. 

c.  Waste  in  expenditure,  due  to  irregularity  of  family 
income. 

d.  Deleterious  effects  upon  the  worker,  such  as  demor- 
alization, worry,  loss  of  skill,  irregularity  of  habits, 
etc. 

e.  The  gradual  loss  of  economic  status  by  workers  who 
are  thrown  out  of  employment  and  the  inevitable 
drift  of  a  large  proportion  into  the  class  ordinarily 
known  as  "casual  laborers,"  the  constant  recruiting 
of  the  large  army  of  dependents  and  delinquents  who 
compose  the  unemployables,  and  the  general  loss  of 
national  efficiency  that  so  great  a  number  of  incapa- 
ble citizens  must  entail. 


166 

/.  The  existence  of  a  supply  of  casual  laborers  and 
irregularly  employed  women  and  children,  upon 
which  parasitic  industries,  unable  to  exist  unless  they 
pay  wages  below  the  standard  of  decent  subsistence, 
are  called  into  being. 


EXISTING  CONDITIONS  OF  EMPLOYMENT. 

In  addition  to  the  large  variations  which  affect  entire  in- 
dustries, there  is  an  ever  present  and  equally  difficult 
problem  in  the  unsteadiness  of  employment.  The  exist- 
ing methods  of  hiring  and  discharging  employees,  and  the 
constant  changing  of  positions  by  the  workers  themselves, 
divide  the  work  among  a  much  larger  number  of  em- 
ployes than  are  actually  needed.  Instead  of  one  person 
being  employed  where  there  is  work  for  but  one,  several 
are  hired  during  the  course  of  the  year  to  occupy  the  same 
position.  Thus  an  investigation  of  the  cloak  and  suit  in- 
dustry of  New  York  showed  that  the  maximum  number  of 
employees  in  16  occupations  during  any  week  of  the  year 
was  1952.  Actually,  however,  the  pay  rolls  showed  that 
4000  people  were  employed  in  these  occupations.  This 
''turnover"  of  the  labor  force,  the  constant  shifting  from 
job  to  job,  the  dropping  and  hiring  of  men,  is  peculiar  to 
no  industry.  It  is  found  everywhere,  among  women  as 
well  as  men,  and  it  is  a  kind  of  irregularity  of  employ- 
ment that  is  a  constant  factor.  A  large  mail-order  house 
which  began  the  year  with  about  10,500  employees  and 
ended  with  about  the  same  number,  engaged  during  that 
year  8841  people  in  order  to  maintain  their  force.  A  man- 
ufacturing establishment  employing  in  1913  an  average 
of  7200  people,  hired  6980  during  that  year.  An  automo- 
bile factory  was  reported  in  1912  to  have  hired  21,000 
employees  in  order  to  maintain  an  operating  force  of 
10,000.  A  large  steel  plant  employing  about  15,000  men 
hires  normally  an  equal  number  to  maintain  that  force. 
During  the  years  when  it  wanted  to  increase  the  force, 


167 

three  and  one-half  times  as  many  were  hired  as  were 
actually  needed  to  make  up  the  increase.  In  some  lumber 
camps  and  saw  mills  on  the  Pacific  Coast  all  men  are  dis- 
charged twice  a  year,  in  July  and  December,  and  com- 
plete new  forces  are  hired  when  work  is  resumed.  In  the 
logging  camps  it  is  customary  to  hire  five  men  in  the 
course  of  the  season  to  keep  one  job  filled. 

A  manager  of  a  large  electrical  works  made  a  study  of 
a  group  of  representative  factories  (large,  small  and  me- 
dium) in  the  mechanical  industries  and  found  that  to  in- 
crease their  working  force  by  8128  people  in  the  year  1912, 
they  actually  hired  44,365  people ;  that  is  to  say,  five  and 
one-half  times  the  number  actually  needed  to  make  up  the 
increase  were  hired  and  36,237  were  dropped  from  the 
rolls  for  one  reason  or  another. 

9.  Detailed  investigations  show  that  a  majority  of  the  em- 
ployees dropped  from  the  pay  rolls  leave  of  their  own 
accord.  But  there  is  no  doubt  that  many  of  them  leave 
because  they  were  hired  to  do  work  for  which  they  were 
unfitted;  and  many  others,  without  actually  being  dis- 
charged, leave  because  work  is  slack  or  threatens  to  be- 
come slack.  In  the  lower-paid  and  more  disagreeable 
jobs  there  is  almost  a  constant  shifting  of  employees  be- 
cause no  one  works  at  these  jobs  except  during  those  pe- 
riods when  he  is  helpless  and  can  get  no  other  work. 
"Whatever  the  reason  is  for  the  men  quitting,  there  is  no 
doubt  that  conditions  of  employment  and  methods  of  hir- 
ing and  discharging  employees  have  very  much  to  do  with 
causing  a  large  "turnover"  of  the  labor  forces.  Those 
employers  who  have  given  attention  to  this  question  of 
hiring  and  discharge  have  been  able  to  reduce  the  "turn- 
over" very  greatly,  and  thus  make  employment  more 
steady. 

10.  The  problem  of  unemployment  has  never  received  ade- 
quate attention,  apparently  because  it  has  been  believed 
generally  that  it  affected  only  a  small  part  of  the  working 


168 

population.  Such  a  belief  is  absolutely  false.  Not  only 
is  practically  every  wage  earner  in  constant  dread  of  un- 
employment, but  there  are  few  who  do  not  suffer  bitterly 
many  times  in  their  career  because  they  are  unable  to  get 
work.  Every  year  from  15,000  to  18,000  business  enter- 
prises fail  and  turn  their  employees  out ;  every  year  new 
machinery  and  improved  processes  displace  thousands; 
cold  weather  and  wet  weather  and  hot  weather  stop  op- 
erations and  force  wage  earners  into  idleness ;  and  where 
there  are  not  these  natural  causes  there  are  the  customs 
and  habits  and  holiday  rushes  which  result  in  overwork 
followed  by  underemployment.  Employers  change  the 
locations  of  their  plants  and  conditions  of  credit  and  cur- 
rency cause  depressions  and  shutdowns  and  short-time 
and  part-time  work.  Constantly  the  methods  of  hiring 
and  discharging  employees  are  causing  people  to  be 
dropped  from  the  pay  rolls.  All  these  facts  in  connec- 
tion with  the  conservative  figures  of  fluctuation  in  the 
amount  of  employment  prove  that  ''The  Unemployed" 
eventually  include  practically  every  wage  earner,  and  not 
alone  a  surplus  portion. 
11.  Practically  all  wage  earners  are  affected  by  the  fluctua- 
tions of  industry.  To  count  the  number  of  the  unem- 
ployed at  any  given  time  becomes  almost  impossible,  since 
the  number  is  changing  from  day  to  day.  The  unem- 
ployed of  today  are  the  workers  of  tomorrow,  and  vice 
versa. 

The  permanently  unemployed  are  really  people  who  have 
dropped  out  of  the  ranks  of  industry,  broken  down  by  the 
unsteadiness  of  employment  or  other  causes.  Some  are 
mentally  defective  or  physically  incapable  or  both.  Others 
are  ' '  down-and-outs, '  *  who  have  lost  the  habit  of  working. 
Still  others  live  by  their  wits,  by  begging,  or  by  crime. 
During  the  most  prosperous  times,  when  labor  is  in  great 
demand,  these  same  people  do  not  work.  They  are  "un- 
employed" in  the  same  sense  that  young  children,  the  old, 
and  the  sick,  and  those  who  live  on  incomes  from  invest- 


169 

ments,  are  unemployed.  No  amount  of  work  that  might 
be  provided  by  public  or  private  enterprise  would  have 
any  appreciable  effect  on  these  unemployables.  They 
need  hospital  or  corrective  treatment.  In  prosperous 
times  they  are  considered  the  subjects  of  such  treatment, 
but  in  every  period  of  industrial  depression  they  stand 
out  as  the  most  conspicuous  element  in  the  "army  of  the 
unemployed." 

The  failure  to  distinguish  these  unemployables  from 
those  who  are  temporarily  out  of  work  on  account  of  a 
slack  season  or  the  failure  of  a  firm  and  those  casual 
workers  who  are  employed  for  part  of  every  week  or 
month,  leads  to  hopeless  confusion. 

12.  The  fluctuations  in  business  affect  capital  as  well  as  labor, 
but  the  result  is  entirely  different.  Capital  suffers  the 
same  fluctuations  and  every  industry  has  its  "peak 
loads."  The  essential  differences  are,  first,  that  a  fair 
return  on  investments  is  estimated  by  the  year,  while  for 
labor  it  has  become  more  and  more  customary  to  hire  and 
pay  and  discharge  by  the  week,  day,  or  hour,  or  by  the 
piece,  and,  second,  that  while  capital  can  offset  the  fat 
years  against  the  lean,  the  human  beings  who  are  unem- 
ployed can  not,  but  must  starve  or  suffer  a  rapid  physical 
and  moral  deterioration.  The  result  is  that  unless  the 
wage  earners  are  very  strongly  organized — and  the  vast 
majority  are  not — they  must  bear  the  whole  burden  of  the 
waiting  period  when  they  must  act  as  a  reserve  force 
ready  to  meet  the  maximum  demand  of  the  busy  season. 
We  do  not  consider  policemen  unemployed  when  they  are 
not  arresting  violators  of  the  peace,  and  we  do  not  consider 
firemen  out  of  work  when  they  sit  in  the  firehouses  pre- 
pared to  do  their  duty.  But  for  most  working  people 
industry  is  still  conducted  on  a  sort  of  volunteer  fire  de- 
partment basis.  In  the  busy  seasons  and  prosperous 
years  all  are  desirable  and  useful  citizens.  At  other  times 
they  are  useless  and  worthless,  so  far  as  our  industries 


170 

are  concerned.    They  are  turned  adrift  to  take  care  of 
themselves  and  those  dependent  on  them  as  best  they  can. 

EXISTING  AGENCIES  FOR  EMPLOYMENT. 

13.  The  first  step  in  any  intelligent  attempt  to  deal  with  the 
problem  is  the  organization  of  the  labor  market  on  a  sys- 
tematic business-like  and  efficient  basis. 

14.  Labor  exchanges  can  not  create  work  nor  make  the  ex- 
isting irregular  demand  for  labor  steady  the  year  through, 
but  they  can,  if  properly  managed,  remove  the  unneces- 
sary loss  of  time  which  workers  now  suffer  in  passing 
from  one  job  to  the  next ;  they  can  eliminate  the  number- 
less evils  which  now  characterize  private  employment  of- 
fices ;  and  they  can  provide  the  information  and  adminis- 
trative machinery  which  is  essential  to  every  other  stop 
in  dealing  with  the  problem. 

15.  The  absurdity  and  waste  which  characterizes  the  existing 
system  of  marketing  labor  can  best  be  appreciated  by 
imagining  the  condition  which  would  be  produced  if  ewi  y 
manufacturer  who  needed  lathes,  drill  presses,  planers, 
and  milling  machines  advertised  for  them  in  the  papers, 
and  many  machines  were  sent  to  him,  out  of  which  he 
could  pick  the  few  he  wanted.  Yet  that  is  exactly  what 
happens  when  machine  hands,  human  beings,  are  wanted ; 
when  the  calls  go  out  for  harvest  hands  or  when  any  other 
class  of  labor  is  advertised  for.  No  one  knows  how  many 
will  answer  the  advertisement.  Many  more  than  the 
number  needed  respond  to  the  calls.  The  waste  of  time. 
energy,  car  fare  and  railroad  fare,  to  get  to  the  places,  is 
enormous.  Often  men  quit  positions  in  the  hope  of  get- 
ting the  alluringly  advertised  work.  Many  employers 
do  not  even  advertise.  They  simply  hang  the  ''Help 
wanted"  sign  at  the  door  and  depend  on  people  to  walk 
the  streets  and  watch  for  these  signs. 


171 

16.  Wherever  systematic  methods  and  intelligent  organiza- 
tion and  direction  are  lacking,  there  evils  creep  in  to  add 
to  the  chaos.  That  is  exactly  what  we  find  has  happened 
in  the  labor  market.  The  saloon  becomes  one  of  the  most 
important  places  in  the  country  to  get  information  about 
jobs.  Pool  rooms,  cafes,  grocery  stores,  lodging  houses, 
even  street  corners  and  public  parks,  become  improvised 
labor  markets.  In  these  places  many  and  strange  abuses 
are  met  with.  Groundless  rumors  send  people  scurrying 
over  the  city  and  the  country  on  a  wild-goose  chase.  One 
job-seeker  sells  information  to  another,  and  quite  often 
it  is  false  or  misleading.  Foremen  sell  real  or  bogus 
jobs  under  their  control.  Fees  for  jobs  are  paid  by  buy- 
ing drinks,  and  "man  catchers"  pick  up  victims  to  rob 
or  abuse. 

17.  Of  all  the  evils,  the  wild  rumors  regarding  available  jobs 
are  the  greatest.  These  evils  are  increased  by  fake  "want 
ads"  in  the  newspapers,  untruthful  or  innocently  mislead- 
ing advertisements  for  help,  and  news  stories  intended  to 
boost  towns  or  industries  or  to  attract  large  supplies  of 
labor.  Investigators  and  men  who  were  sent  to  answer 
1 '  want  ads ' '  found  many  of  these  inserted  by  employment 
agents  who  had  no  jobs  to  offer  but  who  wanted  to  collect 
registration  fees.  Other  advertisements  were  pure  fakes, 
inserted  by  "white  slavers,"  bogus  real  estate  and  stock 
brokers,  selling  agents  of  "new  propositions,"  padrones 
and  other  swindlers.  A  study  of  newspaper  want  adver- 
tisements made  a  few  years  ago  revealed  that  when. times 
are  good  one-fourth  or  more  are  "fake  ads,"  while  in 
hard  times  more  than  one-half  are  in  this  class. 

18.  Private  enterprise  has  attempted  to  deal  with  the  situa- 
tion through  the  establishment  of  employment  agencies 
which  gather  information  regarding  opportunities  for  em- 
ployment and  sell  the  information  to  work-seekers,  and, 
under  certain  conditions,  collect  fees  also  from  employers. 
The    number    of    private    employment    agents    varies 


172 

greatly  from  year  to  year,  but  there  must  be  from  3000 
to  5000  of  these  labor  middlemen  in  the  country. 

Investigations  show,  however,  that  instead  of  relieving 
unemployment  and  reducing  irregularity,  these  employ- 
ment agencies  actually  serve  to  congest  the  labor  market 
and  to  increase  idleness  and  irregularity  of  employment. 
They  are  interested  primarily  in  the  fees  they  can  earn, 
and  if  they  can  earn  more  by  bringing  workers  to  an  al- 
ready overcrowded  city,  they  do  so.  Again  it  is  an  al- 
most universal  custom  among  private  employment  agents 
to  fill  vacancies  by  putting  in  them  people  who  are  work- 
ing at  other  places.  In  this  way  new  vacancies  are  cre- 
ated and  more  fees  can  be  earned. 

19.  They  also  fail  to  meet  the  problem  because  they  are  so 
numerous  and  are  necessarily  competitive.  With  few  ex- 
ceptions there  is  no  cooperation  among  them.  This  diffi- 
culty is  further  emphasized  by  the  necessity  of  paying 
the  registration  fees  required  by  many  agencies;  obvi- 
ously the  laborer  can  not  apply  to  very  many  if  he  has 
to  pay  a  dollar  at  each  one. 

20.  The  fees  which  private  employment  offices  must  charge 
are  barriers  which  prevent  the  proper  flow  of  labor  into 
the  channels  where  it  is  needed,  and  are  a  direct  influ- 
ence in  keeping  men  idle.  In  the  summer,  when  employ- 
ment is  plentiful,  the  fees  are  as  low  as  25  cents,  and  men 
are  even  referred  to  work  free  of  charge.  But  this  must 
necessarily  be  made  up  in  the  winter,  when  work  is  scarce. 
At  such  times,  when  men  need  work  most  badly,  the  pri- 
vate employment  offices  put  up  their  fees  and  keep  the 
unemployed  from  going  to  work  until  they  can  pay  $2, 
$3,  $5,  and  even  $10  and  more  for  their  jobs.  This  ne- 
cessity of  paying  for  the  privilege  of  going  to  work,  and 
paying  more  the  more  urgently  the  job  is  needed,  not  only 
keeps  people  unnecessarily  unemployed,  but  seems  foreign 
to  the  spirit  of  American  freedom  and  opportunity. 


173 

21.  An  additional  injustice  inevitably  connected  with  labor 
agencies  which  charge  fees  is  that  they  must  place  the 
entire  cost  of  the  service  upon  those  least  able  to  bear  it. 
Employment  agents  say  that  employers  will  not  pay  the 
fees ;  hence  they  must  charge  the  employees.  Among  the 
wage  earners,  too,  however,  those  who  are  least  in  need 
and  can  wait  for  work,  pay  the  least  for  jobs  and  even 
get  them  free,  while  those  who  are  most  in  need  make  up 
for  all  the  rest  and  pay  the  highest  fees.  The  weakest  and 
poorest  classes  of  wage  earners  are  therefore  made  to 
pay  the  largest  share  for  a  service  rendered  to  employ- 
ers, to  workers,  and  to  the  public  as  well. 

22.  The  fees  paid  private  employment  agents  in  California  in 
the  license  year  ending  March  31, 1912,  amounted  to  $403,- 
000.  Using  these  figures  as  a  rough  basis,  the  fees  for 
the  country  as  a  whole  amount  annually  to  $15,000,000. 
This  enormous  sum  of  money,  which  is  being  paid  chiefly 
out  of  the  meager  earnings  of  domestic  servants,  clerks 
and  unskilled  laborers,  would  be  enough  to  support  a 
system  of  public  exchanges  which  would  bring  order  out 
of  the  existing  chaos. 

23.  There  are  many  private  employment  agents  who  try  to 
conduct  their  business  honestly,  but  they  are  the  excep- 
tion rather  than  the  rule.  The  business  as  a  whole  reeks 
with  fraud,  extortion,  and  flagrant  abuses  of  every  kind. 
The  most  common  evils  are  as  follows : 

Fees  are  often  charged  out  of  all  proportion  to  the 
service  rendered.  We  know  of  cases  where  $5,  $9,  $10, 
and  even  $16  apiece  has  been  paid  for  jobs  at  common 
labor.  In  one  city  the  fees  paid  by  scrubwomen  is  at  the 
rate  of  $24  a  year  for  their  poorly  paid  work.  Then  there 
is  discrimination  in  the  charges  made  for  the  same  jobs. 
Often,  too,  men  are  sent  a  long  distance,  made  to  pay 
fees  and  transportation,  only  to  find  that  no  one  at  that 
place  ordered  men  from  the  employment  agent.  A  most 
pernicious  practice  is  the  collusion  with  foremen  or  super- 


174 

intendents  by  which  the  employment  agent  "splits  fees" 
with  them.  That  is,  the  foreman  agrees  to  hire  men  of 
a  certain  employment  agent  on  condition  that  one-fourth 
or  one-half  of  every  fee  collected  from  men  whom  he  hires 
be  given  to  him.  This  leads  the  foreman  to  discharge  men 
constantly  in  order  to  have  more  men  hired  through  the 
agent  and  more  fees  collected.  It  develops  the  "three 
gang"  method  so  universally  complained  of  by  railroad 
and  construction  laborers;  namely,  one  gang  working, 
another  coming  to  work  from  the  employment  agent,  and 
a  third  going  back  to  the  city. 

Finally,  there  is  the  most  frequent  abuse — misrepre- 
sentation of  terms  and  condition  of  employment.  Men 
are  told  that  they  will  get  more  wages  than  are  actually 
paid,  or  that  the  work  will  last  longer  than  it  actually 
will,  or  that  there  is  a  boarding  house  when  there  really 
is  an  insanitary  camp,  or  that  the  cost  of  transportation 
will  be  paid  when  it  is  to  be  deducted  from  the  wages. 
They  are  not  told  of  other  deductions  that  will  be  made 
from  wages;  they  are  not  informed  about  strikes  that 
may  be  on  at  the  places  to  which  they  are  sent,  nor  about 
other  important  facts  which  they  ought  to  know.  These 
misrepresentations,  it  must  be  said,  are  often  as  much 
the  fault  of  the  employer  as  of  the  labor  agent.  Also  the 
employer  will  place  his  call  for  help  with  several  agents 
and  each  will  send  enough  to  fill  the  whole  order,  causing 
many  to  find  no  jobs.  Labor  agents  and  laborers  alike 
are  guilty  of  the  misuse  of  free  transportation  furnished 
by  employers  to  prospective  help.  And  it  is  true  also  that 
many  applicants  perpetrate  frauds  on  the  labor  agents 
themselves,  as,  for  example,  causing  them  to  return  fees 
when  positions  actually  were  secured.  This  is  the  result 
of  the  general  feeling  that  the  whole  system  of  paying 
fees  for  jobs  is  unjust ;  and  if  they  must  pay  in  order  to 
get  work,  then  any  attempt  to  get  the  fee  back  is  justi- 
fiable. 


175  '        • 

24.  Attempts  to  remove  these  abuses  by  regulation  have  been 
made  in  thirty-one  States,  but  with  few  exceptions  they 
have  proved  futile,  and  at  most  they  have  served  only  to 
promote  a  higher  standard  of  honesty  in  the  business  and 
have  not  removed  the  other  abuses  which  are  inherent  in 
the  system.  Where  the  States  and  cities  have  spent  much 
money  for  inspectors  and  complaint  adjusters,  there  has 
been  considerable  improvement  in  the  methods  of  private 
employment  agencies,  but  most  of  the  officers  in  charge  of 
this  regulation  testify  that  the  abuses  are  in  "the  nature 
of  the  business"  and  never  can  be  entirely  eliminated. 
They  therefore  favor  the  total  abolition  of  private  labor 
agencies.  This  is  also  the  common  opinion  among  work- 
ing people,  and  in  several  States  attempts  have  already 
been  made  to  accomplish  this  by  law. 

25.  It  is  significant  that  trade  union  members  are  practically 
never  found  among  the  applicants  for  charity  during  pe- 
riods of  unemployment.  They  may  be  unemployed,  but 
they  are  in  some  way  cared  for,  either  by  having  work 
found  for  them  or  by  systematic  or  voluntary  relief. 
Within  each  strongly  organized  trade,  it  may  be  said,  the 
problem  of  connecting  man  and  job  is  cared  for  fairly 
well.  The  union  headquarters  is  the  most  common  labor 
market  for  organized  workers.  Ordinarily,  no  systematic 
employment  business  is  done,  but  many  unions  have  out- 
of-work  books  in  which  the  unemployed  write  their  names, 
and  it  is  part  of  the  duties  of  the  business  agent  of  every 
union  to  be  on  the  lookout  for  vacancies  and  to  notify 
members  seeking  employment  of  the  opportunities.  Many 
unions  also  have  traveling  benefits  to  assist  members  in 
going  from  place  to  place.  But  when  it  comes  to  placing 
men  outside  of  their  own  trades,  the  unions  are  not  suc- 
cessful as  employment  offices. 

Partly  for  this  reason  and  partly  for  the  reason  that 
only  a  small  part  of  the  wage  earners  are  in  strongly  or- 


176 

ganized  trades,  the  trade  unions  occupy  a  minor  place  in 
the  general  labor  market. 

26.  Within  recent  years  associations  of  employers  have  es- 
tablished employment  offices  in  all  the  important  cities 
of  the  country.  The  movement  is  spreading  very  rapidly 
and  there  is  hardly  an  important  industrial  center  in  the 
country  that  has  not  a  bureau  of  this  kind.  These  offices 
are  supported  out  of  the  funds  of  the  employers'  associa- 
tions, and  their  services  are  free  to  working  people.  Most 
of  them,  however,  do  a  very  small  employment  business. 

Almost  all  of  these  offices  owe  their  origin  to  the  move- 
ment among  employers  to  establish  and  maintain  the  so- 
called  "open  shop"  or  the  ''anti-union  shop."  Since  their 
establishment,  employers  have  discovered  that  such  offices 
are  very  useful  also  in  creating  central  clearing  houses 
for  labor,  "constituting  the  shortest  cut  between  supply 
and  demand."  This,  however,  is  not  their  primary  pur- 
pose, for  nowhere  have  they  extended  their  operations 
to  include  common  laborers,  who  suffer  most  from  dis- 
organization of  the  labor  market.  These  bureaus  are 
merely  divisions  of  the  regular  business  of  the  employ- 
ers' associations,  and  one  of  the  main  purposes  of  these 
associations  is  to  prevent  the  organization  of  their  shops 
by  trade  unions.  The  employment  bureaus  are  estab- 
lished and  maintained  to  further  this  purpose. 

The  employment  bureaus  maintained  by  employers' 
associations,  therefore,  not  only  are  of  no  practical  value 
as  a  means  of  solving  the  problem  of  unemployment,  but 
on  the  contrary,  because  they  are  organized  primarily  to 
prevent  the  employment  of  skilled  workmen  who  are  dis- 
tasteful to  their  members,  are  actual  barriers  to  the  free 
movement  of  labor. 

27.  In  every  city  there  are  religious  and  charitable  organiza- 
tions which  attempt  to  find  work  for  destitute  persons. 
In  connection  with  the  charity  societies  of  the  larger  cities, 
regular  employment  agencies  are  maintained,  but  very 


177 

little  business,  comparatively,  is  done  by  these  offices. 
Working  people  do  not  go  to  them  and  employers  do  not 
call  for  employees  at  such  offices,  except  occasionally  for 
men  to  do  odd  jobs,  or  when  they  agree  to  place  someone 
as  a  favor  to  the  charity  workers.  The  main  work  of  the 
charitable  employment  offices  is  to  find  odd  jobs  for  the 
unemployed  who  can  not  hold  ordinary  positions.  They 
also  help  people  handicapped  by  age,  illness,  or  other 
physical  or  mental  defect.  Their  primary  purpose  is 
charity.  They  may  be  said  to  have  no  effect  whatever  on 
employment  conditions  for  able-bodied  workers. 

Until  the  State  is  ready  and  able  to  take  proper  care 
of  its  handicapped,  diseased,  and  subnormal  members,  the 
charitable  employment  agencies  and  institutions  will  con- 
tinue to  be  necessary,  because  labor  exchanges  properly 
organized  on  a  business  basis,  whether  by  public  or  by 
private  enterprise,  can  not  deal  with  the  handicapped 
classes  of  labor.  Those  who  are  physically  or  mentally 
unfit  to  hold  positions  should  be  sent  to  the  places  where 
they  will  get  the  relief  they  need  and  not  to  work  which 
they  would  quit  or  from  which  they  would  be  dismissed 
in  a  few  days. 

PUBLIC  EMPLOYMENT  AGENCIES. 

28.  In  1890  Ohio  created  the  first  public  employment  offices  in 
this  country.  Since  that  time,  such  offices  have  been  es- 
tablished in  twenty-three  other  States  and  they  are  now 
in  operation  in  about  80  cities.  Most  of  them  were  cre- 
ated by  State  laws;  a  few  are  municipal  enterprises. 
They  represent  an  expense  to  the  States  and  cities  of 
about  $300,000  annually;  and  according  to  their  reports 
they  fill  about  500,000  positions  a  year. 

29.  As  a  result  of  a  very  extensive  investigation  it  has  been 
found  that  the  public  employment  offices  of  the  United 
States,  as  a  whole,  are  issuing  inaccurate  statistics.    They 


178 

are  slipshod  in  recording  information  about  employers 
and  employees.  They  cater  too  much  to  casual  laborers 
and  "down-and-outs,"  thus  driving  away  the  better  class 
of  workers.  Too  many  are  poorly  housed,  with  insuffi- 
cient lighting  and  ventilation.  They  fail  to  supplant  pri- 
vate agencies  or  to  lessen  their  exploitation  of  workers. 
They  do  not  exchange  information  even  when  closely  lo- 
cated. They  fail  to  bring  themselves  to  public  attention, 
either  by  advertising  or  otherwise,  and  they  have  failed 
to  arouse  public  interest  in  their  work.  This  is  true  of 
public  employment  offices  taken  as  a  whole,  but  there  are 
some  very  bright  exceptions.  During  the  last  few  years, 
also,  the  labor  departments  have  been  devoting  more  at- 
tention to  the  work  of  public  employment  offices  and  many 
improvements  have  resulted  which  show  that  the  prin- 
ciples underlying  the  offices  are  sound  but  that  they  have 
not  been  properly  carried  out. 

30.  The  reasons  for  the  failure  of  most  of  the  public  em- 
ployment offices  are: 

First,  the  inefficiency  and  lack  of  training  of  the  offi- 
cials and  clerks  who  operate  the  agencies.  A  public  em- 
ployment office  must  build  up  its  work  by  soliciting  busi- 
ness and  giving  service  that  is  felt  to  be  valuable ;  other- 
wise little  attention  will  be  paid  to  it.  For  this  purpose 
men  of  judgment  and  experience  are  necessary  to  carry 
on  the  work.  It  is  a  technical  business  requiring  not  a 
mere  shuffling  of  applications,  but  careful  selection  of 
applicants  and  thorough  understanding  of  the  require- 
ments of  positions  to  which  they  are  to  be  sent. 

Second,  the  offices  have  generally  been  regarded  as  po- 
litical spoils,  with  a  consequent  change  of  personnel  after 
each  election. 

Third,  the  salaries  have  been  inadequate  to  attract  com- 
petent men. 

Fourth,  the  public  employment  offices  have  been  the 
objects  of  suspicion,  if  not  of  actual  opposition,  by  em- 


179 

ployers  and  organized  labor  as  well.  Union  men  have 
feared  that  the  offices  might  be  used  as  strikebreaking 
agencies,  or  to  lower  wage  rates.  Employers,  on  the  other 
hand,  have  feared  that  the  offices  might  be  used  to  fill 
their  shops  with  union  men  and  labor  agitators. 

The  activities  of  the  Federal  Department  of  Labor  in 
connection  with  unemployment  have  been  chiefly  attempts 
to  utilize  the  existing  machinery  of  the  Bureau  of  Im- 
migration and  the  Post  Office  Department  for  receiving 
the  applications  of  men  out  of  work,  collecting  informa- 
tion regarding  opportunities  for  employment,  and  as  far 
as  possible  referring  idle  men  to  opportunities  for  work. 
For  this  purpose  the  country  has  been  divided  into  18 
zones,  with  a  central  office  in  each  which  is  in  charge  of 
an  immigrant  inspector.  Applications  from  employers 
and  employees  are  received  either  directly  or  through  a 
special  arrangement  with  the  Post  Office  Department. 

The  statutory  authority  for  the  establishment  of  the 
system  is  contained  in  the  act  of  1907  creating  a  Division 
of  Information  in  the  Bureau  of  Immigration,  broadened 
in  scope  by  the  act  creating  the  Department  of  Labor. 
The  opportunity  to  establish  the  system  arose  through 
the  great  decrease  in  immigration,  which  left  a  large  part 
of  the  resources  of  the  Bureau  of  Immigration  available 
for  this  purpose.  The  system  was  established  only  in 
March,  1915,  and  it  can  not  properly  be  judged  on  the 
results  of  this  very  limited  experience.  The  most  prom- 
ising feature  of  the  entire  system  is  the  arrangement 
which  has  been  made  for  close  cooperation  with  the  Na- 
tional Farm  Labor  Exchange,  which  has  been  organized 
by  the  Labor  Commissioners  of  the  States  in  the  wheat 
belt.  No  such  close  cooperation  has  yet  been  established 
with  any  other  public  employment  system  and  no  effort 
has  been  made  to  regulate  the  abuses  of  the  private  ex- 
changes which  do  business  in  two  or  more  States. 

The  following  observations  regarding  the  present 
scheme  of  the  Department  of  Labor  seem  to  be  proper : 


180 

a.  The  system  of  zones  and  central  offices  is  sound  and 
affords  a  suitable  framework  for  the  development  of 
the  system. 

b.  The  operation  of  the  system  directly  by  the  Bureau 
of  Immigration  is  likely  to  deter  a  great  many  work- 
men from  utilizing  it,  through  a  belief  that  it  is  in- 
tended only  for  immigrants. 

c.  The  employers  have  generally  assumed  an  attitude 

of  suspicion  toward  the  Department  of  Labor,  which 
forms  a  great  handicap. 

d.  The  system  does  not  yet  provide  for  sufficiently  close 
cooperation  with  the  State  and  municipal  employ- 
ment offices. 

e.  The  system  of  registering  applications  does  not  pro- 

vide for  the  close  personal  contact  which  is  necessary 
to  ascertain  the  requirements  of  the  employer  or  to 
select  the  workman  who  is  capable  of  filling  such  re- 
quirements. The  success  of  every  employment  office 
depends  upon  this  personal  contact. 

/.  The  qualifications  demanded  in  the  examination  of 
immigrant  inspectors  are  not  designed  to  secure  men 
who  are  properly  qualified  to  operate  public  employ- 
ment offices. 

g.  A  national  employment  system  should  not  have  to  de- 
pend upon  the  exigencies  of  the  general  immigra- 
tion service. 

h.  The  system  can  not  attain  efficiency  until  provision 
is  made  for  the  regulation  of  private  agencies  which 
operate  in  two  or  more  States. 

i.  The  successful  operation  of  a  national  employment 
system  can  not  be  attained  until  provision  is  made  for 


181 

some  form  of  cheap  transportation,  which  will  assure 
the  prompt  arrival  of  workers  at  points  where  they 
are  needed  and  eliminate  the  present  wasteful,  dan- 
gerous and  demoralizing  practice  of  workers  riding 
on  freight  trains. 

j.  In  order  to  secure  the  confidence  of  both  capital  and 
labor,  the  creation  of  national  and  local  advisory 
committees  consisting  of  employers  and  employees 
is  advisable.  Such  committees  would  also  be  of  great 
assistance  through  their  knowledge  of  the  local  in- 
dustrial conditions. 

It  is  suggested  that  the  Commission  recommend: 

1.  The  enactment  of  appropriate  legislation  modifying  the 
title  of  the  Bureau  of  Immigration  to  "Bureau  of  Immi- 
gration and  Employment"  and  providing  the  statutory 
authority  and  appropriations  necessary  for — 

a.  The  establishment  of  a  national  employment  sys- 
tem, under  the  Department  of  Labor,  with  a  staff 
of  well  paid  and  specially  qualified  officials  in  the 
main  offices  at  least. 

b.  The  licensing,  regulation,  and  supervision  of  all 
private  employment  agencies  doing  an  interstate 
business. 

c.  The  investigation  and  preparation  of  plans  for  the 
regularization  of  employment,  the  decasualization  of 
labor,  the  utilization  of  public  work  to  fill  in  periods 
of  business  depression,  insurance  against  unemploy- 
ment in  such  trades  and  industries  as  may  seem  de- 
sirable, and  other  measures  designed  to  promote 
regularity  and  steadiness  of  employment. 

2.  The  immediate  creation  of  a  special  board  made  up  of  the 
properly  qualified  officials  from  the  Departments  of  Agri- 


182 

culture,  Commerce,  Interior  and  Labor  and  from  the 
Board  of  Army  Engineers  to  prepare  plans  for  perform- 
ing the  largest  possible  amount  of  public  work  during  the 
winter,  and  to  devise  a  program  for  the  future  for  per- 
forming during  periods  of  depression  such  public  work 
as  road  building,  construction  of  public  buildings,  re- 
forestation, irrigation,  and  drainage  of  swamps.  The 
success  attending  the  construction  of  the  Panama 
Canal  indicates  the  enormous  national  construction  works 
which  might  be  done  to  the  advantage  of  the  entire  Nation 
during  such  periods  of  depression.  Similar  boards  or 
commissions  should  be  established  in  the  various  States 
and  municipalities. 


183 


XII.     Organization,    Methods    and   Policies    of    Trade 

Unions. 

The  investigations  of  the  Commission  conducted  under  the 
direction  of  Dr.  George  E.  Barnett,  are  the  basis  of  the  fol- 
lowing conclusions: 

1.  The  number  of  trade  unionists  relative  to  the  working 
population  is  steadily  increasing,  although  in  certain  in- 
dustries, on  account  of  the  opposition  of  the  great  cor- 
porations and  hostile  employers'  associations,  trade 
unionism  is  practically  nonexistent.  At  present  it  may 
be  roughly  estimated  that  in  manufacturing,  mining, 
transportation  and  the  building  industries,  if  the  pro- 
prietary, supervisory,  official  and  clerical  classes  are  ex- 
cluded, twenty-five  per  cent  of  the  workers  twenty-one 
years  of  age  and  over  are  trade  unionists. 

2.  The  effects  of  trade  unionism  on  wages  are  undoubted. 
Without  some  form  of  combination  the  wage  workers  can 
not  bargain  on  equal  terms  with  their  employers.  During 
the  past  fifteen  years,  a  period  of  rapidly  rising  prices, 
wages  in  well  organized  trades  have  kept  pace  with  the 
rising  cost  of  living,  in  contrast  to  the  relative  decline  of 
the  purchasing  power  of  the  wages  received  by  labor 
generally. 

3.  In  the  well  organized  trades,  the  hours  of  labor  have  been 

steadily  reduced  until  at  present  eight  hours  is  the  normal 
working  day  for  at  least  one-half  of  American  trade 
unionists.  It  is  significant  of  the  influence  of  trade  union- 
ism on  the  length  of  the  working  day  that  it  is  exactly 
in  those  trades  in  which  the  trade  unionists  are  a  rela- 
tively small  part  of  the  total  working  force  that  they 
work  long  hours  relatively  to  other  trade  unionists. 

4.  As  the  unit  of  industry  grows   larger,  and  the  natural 

relation  which  exists  between  the  small  employer  and  his 


184 

workmen  disappears,  the  opportunity  for  unjustifiable 
discharges  and  petty  tyrannies  enlarges.  The  result  is 
distrust  and  enmity  among  the  employees.  The  effective 
remedy  is  the  organization  of  the  workers  and  the  estab- 
lishment of  a  system  of  trade  boards  in  which  the  work- 
ers are  equally  represented  with  power  to  deal  with  such 
questions. 

5.  By  means  of  mutual  insurance  in  case  of  death,  sickness, 

accident,  old  age  and  unemployment,  many  trade  unions 
have  greatly  improved  the  conditions  of  their  members. 
The  extension  of  such  systems  appears  to  be  highly  de- 
sirable. 

6.  The  trade  union  is  a  democratic  institution,  and  faces  the 

same  problems  in  securing  efficient  government  that  other 
democratic  institutions  face.  The  theory  of  government 
which  the  American  trade  unions  have  adopted  is  the  cen- 
tralization of  power  in  the  national  trade  union  as  against 
the  local  unions.  The  successful  carrying  out  of  this 
plan  of  organization  will  eliminate  the  chief  defects  in 
trade  union  government.  The  control  by  the  national 
union  over  strikes  and  the  system  of  mutual  insurance 
is  already  thoroughly  established  in  the  more  important 
unions ;  it  should  be  established  in  all  other  unions. 

7.  Unwarranted  sympathetic  strikes  have  undoubtedly  been 
the  cause  of  great  annoyance  and  considerable  economic 
loss  to  employers.  The  annoyance  in  such  cases  is  partic- 
ularly great,  because  no  direct  action  by  the  employer 
can  be  taken ;  at  best  he  can  only  use  his  influence  with  his 
associates  or  competitors.  With  the  increasing  control 
of  the  national  officers  over  the  local  unions,  this  kind  of 
strike  seems  to  be  decreasing  both  in  extent  and  fre- 
quency. Such  sympathetic  action  is  deep  rooted  in  the 
sense  of  brotherhood  which  to  a  greater  or  less  degree 
pervades  and  will  not  be  completely  eliminated  until  sub- 
stantial justice  exists  throughout  industry. 


185 

J.  A  few  trade  unions  exclude  qualified  persons  from  mem- 
bership by  high  initiation  fees  or  other  devices.  This 
policy  is  condemned  by  the  more  important  unions  and  is 
prohibited  by  their  rules.  The  evidence  presented  to  the 
Commission  shows  clearly  that  the  policy  of  exclusion 
is  antisocial  and  monopolistic,  and  should  be  given  up  by 
those  unions  which  practice  it. 

9.  In  many  trades,  the  efficiency  of  the  union  depends  upon 

the  maintenance  of  the  rule  that  all  those  working  at  the 
trade  shall  become  members  of  the  union.  Where  the 
union  admits  all  qualified  workers  to  membership  under 
reasonable  conditions,  such  a  rule  can  not  become  the 
basis  of  monopoly  and  neither  the  rights  of  the  individual 
nor  the  public  interest  are  infringed  by  its  enforcement. 

10.  In  some  trades  there  are  a  considerable  number  of  union 
rules  which  restrict  the  productivity  of  the  worker.  Some 
of  these  rules  can  be  justified  on  the  ground  that  they  are 
necessary  to  the  protection  of  the  health  of  the  worker. 
There  are  some,  however,  which  can  not  be  defended; 
these  rules  are  antisocial  and  should  be  given  up.  Experi- 
ence has  shown  that  where  industry  is  regulated  by  well 
organized  systems  of  joint  agreements,  such  rules  either 
disappear  or  greatly  decrease  in  number  and  importance. 
These  limitations  of  output  should  not,  however,  be  con- 
sidered as  standing  alone.  The  limitations  of  output  by 
associations  of  employers  and  by  individual  corporations 
are  equally  antisocial  and  have  far  greater  consequences. 

11.  Jurisdictional  disputes  are  the  occasion  of  frequent  and 
costly  strikes.  The  disputes  of  this  character  which  have 
caused  most  injury  are  in  the  building  trades.  Up  to  the 
present,  the  efforts  to  lessen  these  disputes  by  action  of 
the  national  unions  involved  have  largely  failed.  It  is 
suggested  that  the  Commission  recommend  to  the  Amer- 
ican Federation  of  Labor  and  to  the  national  unions  that 
renewed  and  more  effective  efforts  be  made  to  prevent 
such  disputes. 


186 

12.  The  essential  condition  for  trade  union  graft  is  the 
placing  of  the  authority  to  call  strikes  or  to  levy  boycotts 
in  the  hands  of  one  person  without  adequate  provision  for 
supervision.  This  condition  does  not  exist  in  many  unions. 
There  is  abundant  evidence  to  show  that  in  very  many 
cases  it  originates  with  employers  who  desire  to  secure 
an  advantage  over  their  competitors.  The  reason  that 
graft  is  more  prevalent  in  the  building  trades  is  that 
power  is  conferred  on  the  business  agent  to  call  strikes 
without  reference  either  to  the  rank  and  file  or  to  the  na- 
tional officers.  It  has  been  testified  by  employers  who 
have  given  much  attention  to  this  problem  that  any  well 
organized  association  of  employers  can  eliminate  graft 
whenever  its  members  desire  to  do  so.  As  far  as  the 
unions  are  concerned  the  solution  seems  to  lie  in  the  in- 
creased participation  of  the  rank  and  file  in  the  activities 
of  the  organization  and  increased  provisions  for  fixing 
responsibility  upon  their  business  agents. 


187 


XIII.     Organization,  Methods  and  Policies  of  Employ- 
ers' Associations. 

1.  The  Commission  finds  that  in  the  past  ten  years  there  has 
been  a  rapid  growth  in  employers'  associations.  These 
associations,  excluding  those  general  associations  which 
have  been  formed  for  the  purpose  of  advancing  the  polit- 
ical, commercial  or  legal  interests  of  the  employers,  may 
be  divided  into  two  classes,  bargaining  associations  and 
hostile  associations.  The  bargaining  associations  deal 
with  the  unions ;  the  hostile  associations  oppose  collective 
bargaining. 

2.  The  formation  of  bargaining  associations  is  essential  to 
the  existence  of  a  satisfactory  system  of  joint  agree- 
ments. A  considerable  number  of  employers,  although 
accepting  the  results  of  the  joint  conferences  in  their 
trades,  do  not  belong  to  the  associations  of  employers.  It 
is  highly  desirable  that  all  employers  whose  establish- 
ments are  run  in  accordance  with  the  terms  of  a  joint 
agreement  should  be  represented  in  making  that  agree- 
ment. In  many  bargaining  associations  the  control  over 
the  members  is  very  weak.  The  association  has  no  power 
of  discipline  except  expulsion,  and  where  participation 
in  the  making  of  the  agreement  is  regarded  as  of  little 
importance,  expulsion  is  an  inadequate  remedy. 

3.  The  hostile  employers'  association  is  a  comparatively  re- 
cent development.  In  many  cases  these  associations  were 
formed  for  the  purpose  of  negotiating  joint  agreements 
with  the  unions,  but  after  the  failure  of  negotiations  or 
the  breakdown  of  an  agreement  they  assumed  their  pres- 
ent form.  In  some  cases  associations  which  have  been 
hostile  have  resumed  relations  with  the  unions.  There  is 
a  strong  tendency,  however,  for  a  hostile  association  after 
a  few  years  to  develop  principles  and  policies  which  make 
any  agreements  with  the  unions  impossible.    The  hostile 


188 

association  may  be  regarded,  therefore,  as  a  distinct  spe- 
cies with  definitely  fixed  characteristics. 

4.  In  the  majority  of  hostile  employers'    associations,  the 

basic  principle  is  that  the  conditions  of  employment  shall 
be  determined  solely  by  the  individual  employer  and  the 
individual  workman,  but  in  actual  practice  this  results 
uniformly  in  the  dictation  of  conditions  solely  by  the  em- 
ployer. The  " declarations  of  principles"  adopted  by 
these  associations  declare,  for  example,  that  the  "num- 
ber of  apprentices,  helpers  and  handymen  to  be  employed 
will  be  determined  solely  by  the  employer;"  "employees 
will  be  paid  by  the  hourly  rate,  by  premium  system,  by 
piece  work  or  contract  as  the  employers  may  elect;" 
"since  we,  as  employers,  are  responsible  for  the  work 
turned  out  by  our  workmen,  we  must  have  full  power  to 
designate  the  men  we  consider  competent  to  perform  the 
work  and  to  determine  the  conditions  under  which  that 
work  will  be  prosecuted. ' '  Even  as  to  wages,  these  asso- 
ciations are  unwilling  to  bargain  collectively,  since  they 
refuse  to  recognize  a  minimum  wage  or  any  other  stand- 
ard form  of  wage,  without  which  a  collective  agreement 
is  impossible. 

5.  In  a  few  of  the  more  highly  centralized  employers'  asso- 

ciations, wage  rates  are  set  by  the  association  although 
other  conditions  may  be  left  to  the  individual  employer. 
In  these  associations  the  principle  of  individual  bargain- 
ing is  modified  to  the  extent  that  certain  minimum  con- 
ditions of  employment  are  set  by  the  association. 

6.  The  prime  function  of  the  hostile  associations  is  to  aid 
their  members  in  opposing  the  introduction  of  collective 
bargaining.  The  most  important  device  used  by  the 
members  of  the  associations  in  resisting  the  attempts  of 
the  union  to  replace  individual  bargaining  by  joint  agree- 
ment is  discrimination  against  members  of  the  union. 
Many  of  the  associations  have  in  their  "declarations  of 


189 

principles"  the  statement  that  no  discrimination  will  be 
made  against  any  man  because  of  his  membership  in  any 
organization,  but  this  rule  is  not  enforced.  Ordinarily 
members  of  the  union  are  not  discriminated  against,  but 
if  the  number  of  unionists  increases  in  any  shop  until  it 
becomes  large,  the  employer  is  advised  or  decides  on  his 
own  volition  to  hire  no  more  members  of  the  union.  More- 
over, any  workman  who  is  prominent  in  urging  the  others 
to  form  a  union  is  likely  to  be  dismissed.  The  aim  of  the 
association  is  to  prevent  in  ordinary  times  such  an  in- 
crease in  the  number  of  unionists  as  will  lead  to  a  collect- 
ive demand.  The  proposition  is  effective  against  col- 
lective action,  as  membership  of  an  individual  workman 
in  a  union  constitutes  no  menace  to  the  employer's  power 
to  control  his  business  unless  the  individual  can  persuade 
others  to  act  with  him. 

7.  Nearly  all  of  the  important  associations  maintain  em- 
ployment agencies.  These  bureaus  enable  the  members 
of  the  association  to  select  nonunionists  for  employment. 

8.  Practically  all  of  the  associations  maintain  a  secret-service 
department  through  which  they  are  able  to  ascertain  the 
increase  in  the  number  of  the  trade  unionists  and  the 
feeling  of  the  men.  Through  this  information  the  asso- 
ciation is  able  to  forestall  threatened  strikes  and  any 
other  attempt  to  secure  collective  action  on  the  part  of  the 
workers. 

9.  In  some  of  the  associations  an  attempt  is  made  to  induce 

the  individual  employer  to  change  conditions  when  there 
is  evidence  that  dissatisfaction  exists  among  his  work- 
men. Similarly,  some  of  the  associations  have  been  active 
in  promoting  safety  systems  and  welfare  systems. 

10.  Inasmuch  as  the  right  of  workers  to  organize  in  any 
manner  that  they  see  fit  is  fully  recognized  by  society  and 
lias  repeatedly  been  given  a  legal  status  in  the  decisions 
of  even  the  most  conservative  courts,  there  is  strong  rea- 


190 

son  for  holding  that  these  hostile  employers '  associations, 
which  are  organized  primarily  for  the  prevention  of  or- 
ganization, are  not  only  antisocial  but  even,  perhaps,  ille- 
gal. 

It  is  suggested  that  the  Commission  strongly  recommend : 

1.  The  formation  of  strong  and  stable  associations  of  em- 
ployers for  the  purpose  of  negotiating  joint  agreements 
and  otherwise  determining,  upon  a  democratic  and  equita- 
ble basis,  the  fundamental  problems  of  the  trade. 


191 


XIV.     Joint  Agreements. 

The  investigations  of  the  Commission  conducted  under  the 
direction  of  Dr.  George  E.  Barnett,  as  well  as  the  evidence 
presented  at  the  public  hearings,  warrant  the  following  con- 
clusions : 

1.  The  conditions  of  employment  can  be  most  satisfactorily 
fixed  by  joint  agreements  between  associations  of  em- 
ployers and  trade  unions. 

2.  Where  the  association  of  employers  and  the  union,  par- 

ticipating in  the  joint  agreement,  cover  the  entire  com- 
petitive district,  it  becomes  possible  to  regulate  the  trade 
or  the  industry,  not  merely  with  reference  to  wages  and 
hours  but  with  reference  to  unemployment,  the  recruit- 
ing of  the  trade,  and  the  introduction  of  machinery  and 
new  processes.  The  method  of  regulation  by  joint  agree- 
ment is  superior  to  the  method  of  legislative  enactment, 
since  it  is  more  comprehensive,  is  more  elastic,  and  more 
nearly  achieves  the  ideal  of  fundamental  democracy  that 
government  should  to  the  greatest  possible  extent  consist 
of  agreements  and  understandings  voluntarily  made.  The 
method  of  legislative  enactment  is  inapplicable  to  many 
trade  problems,  and  even  where  it  is  supplemented  by  ad- 
ministrative regulation,  it  is  cumbersome. 

3.  The  essential  element  in  a  system  of  joint  agreements  is 
that  all  action  shall  be  preceded  by  discussion  and  delib- 
eration. If  either  party  through  lack  of  organization  is 
unable  to  participate  effectively  in  the  discussion  and 
deliberation,  to  that  extent  the  system  falls  short  of  the 
ideal.  Where  a  union  or  an  employers'  association  de- 
livers its  demands  in  the  form  of  an  ultimatum,  and  de- 
nies the  other  party  an  opportunity  collectively  to  dis- 
cuss the  demands,  a  fundamental  condition  of  the  joint 
agreement  is  lacking. 


192 

4.  The  thorough  and  effective  organization  of  the  employers 
is  lacking  in  many  trades  in  which  the  workmen  are  well 
organized.  It  is  highly  desirable  that  such  organization 
should  be  brought  about. 

5.  In  a  few  trades  agreements  have  been  made  which  pro- 
vide that  the  members  of  the  union  will  not  be  allowed 
to  work  for  any  employers  who  are  not  members  of  the 
employers'  association.  The  usual  result  is  that  the  em- 
ployers' association  restricts  its  membership  or  in  some 
other  manner  artificially  raises  prices  to  the  consumer. 
Such  agreements  are  against  the  public  interest  and 
should  not  be  tolerated. 

6.  Joint  agreements  on  the  whole  are  well  kept.  There  is  a 
constant  increase  in  the  sense  of  moral  obligation  on  the 
part  of  both  employers  and  unions.  Violations  of  agree- 
ments on  the  part  of  a  small  number  of  men  or  of  a  single 
employer  occasionally  occur.  It  is  found  that  the  unions 
tend  more  and  more  to  punish  by  fines  or  other  disciplin- 
ary measure  such  infraction  on  the  part  of  their  members. 
The  great  difficulty  in  the  rapid  solution  of  this  problem 
is  that  even  graver  evils  than  contract-breaking  are  apt 
to  result  from  giving  officials  the  power  which  they  must 
have  in  order  to  punish  properly  individuals  or  local 
unions  for  illegal  strikes.  The  employers'  associations, 
from  the  nature  of  the  case,  have  less  power  over  their 
members,  but  in  practically  all  cases  they  exercise  in  good 
faith  what  power  they  have.  Furthermore,  since  the 
employer  in  the  first  instance  has  the  power  to  interpret 
the  contract,  which  he  may  do  unjustly,  he  may  actually 
be  guilty  of  the  breach  of  contract  when  the  employees 
who  strike  against  such  unjust  interpretation  are  appar- 
ently the  guilty  parties. 

7.  In  certain  agreements  a  specified  money  guaranty  is 
made  by  each  party,  and  in  any  breach  of  the  agreement 
the  guaranty  is  forfeited  to  the  other  sio^e.  On  the  whole, 


193 

such  guaranties  do  not  serve  a  desirable  purpose,  since 
there  is  danger  that  the  parties  may  come  to  regard  the 
forfeiture  of  the  guaranty  as  a  compensation  for  the 
breach  of  the  agreement.1  The  sense  of  moral  obligation 
is  thus  seriously  impaired. 

8.  It  does  not  seem,  nor  has  it  been  urged  by  any  careful 
student  of  the  problem,  whether  employer  or  worker,  that 
any  good  end  would  be  served  by  giving  legal  validity  to 
joint  agreements.  The  agreements  are  formulated  by  par- 
ties acting  without  legal  advice  and  it  not  infrequently 
happens  that  the  form  of  words  adopted  is  capable  of  sev- 
eral constructions.  In  some  cases,  the  language  is  inten- 
tionally general,  though  its  purpose  may  be  fully  under- 
stood by  the  different  parties.  It  is  not  desirable  that 
such  agreements,  the  only  ones  possible  under  the  cir- 
cumstances, should  be  construed  by  the  rigid  rules  cus- 
tomarily used  in  the  courts. 

9.  Every  joint  agreement  should  contain  a  clause  providing 
for  arbitration  in  the  event  that  the  interpretation  of  the 
agreement  is  in  dispute.  Under  such  provision  the  arbi- 
trator would  approach  the  question  unhampered  by  strict 
rules  of  construction.  The  responsibility  for  breaking  an 
agreement  would  under  such  a  plan  be  definitely  located. 

It  is  suggested  that  the  Commission  recommend : 

1.  The  extension  of  joint  agreements  as  regards  not  only 
the  field  of  industry  which  they  cover,  and  the  class  of 
labor  included,  but  the  subjects  which  are  taken  up  for 
negotiation  and  settlement.  Greater  responsibility  for 
the  character,  skill,  and  conduct  of  their  members  should 
accompany  the  greater  participation  of  trade  unions  in 
the  governing  of  industry. 

1 — This  statement  is  not  in  accordance  with  the  finding  of  Dr.  Barnett,  but 
is  formed  after  consideration  of  the  evidence  and  opinion  of  the  British 
Industrial  Council. 


194 


XV.     Agencies  of  Mediation,  Investigation  and  Arbi- 
tration. 

The  result  of  the  very  extensive  investigations  which 
have  been  made  regarding  the  agencies  for  mediation  and 
arbitration  in  this  country  and  abroad  have  been  embodied  in 
the  plan  for  legislation  which  is  attached  hereto.  The  plan 
as  presented  is  limited  to  a  National  System,  but  it  is  recom- 
mended that  the  State  legislatures  should  enact  legislation 
along  the  same  general  lines.  The  general  principles  which 
have  governed  in  drawing  up  this  plan  may  be  stated  as  fol- 
lows: 

1.  The  Mediation  Commission  should  be  independent  of, 
and  definitely  divorced  from,  every  other  department  of 
the  State  or  Federal  Government.  Its  only  power  grows 
out  of  its  impartiality  and  this  can  not  be  secured  if  it  is 
subordinate  to  any  other  body  whose  sympathies  either 
with  labor  or  with  capital  can  be  questioned. 

2.  Mediation  should  be  entrusted  to  a  person  as  far  as  pos- 
sible distinct  from  those  who  act  as  arbitrators  or  ap- 
point arbitrators. 

3.  The  office  of  mediator  should  be  placed  beyond  the  sus- 
picion that  the  office  is  being  used  as  a  reward  for  party 
services. 

4.  The  mediator  should  appoint  his  own  subordinates. 

5.  It  is  desirable  in  the  event  of  the  failure  of  mediation 
by  an  official  mediator,  that  the  parties  should  be  asked 
to  consent  to  the  appointment  of  a  Board  of  Mediation 
and  Investigation  consisting  of  three  persons,  one  selected 
by  each  party  and  the  third  by  these  two.  Such  a  board, 
it  appears,  would  be  able  to  secure  an  agreement  in  many 
cases  where  the  mediator  fails.  These  boards  should  have 
power  to  summon  witnesses  and  compel  the  production 


195 

of  papers.  In  the  event  that  the  board  could  not  secure 
an  agreement  during  the  investigation,  it  should  be  em- 
powered to  make  a  public  report  stating  the  terms  on 
which,  in  its  judgment,  the  parties  should  settle. 

In  those  cases  in  which  the  parties  are  unable  to  agree 
on  the  third  member  of  the  Board  of  Mediation  and  In- 
vestigation, he  should  be  appointed  in  the  State  Systems 
by  the  State  Board  of  Arbitration,  and  in  the  National 
System  by  the  mediators,  from  a  list  prepared  in  advance 
by  an  Advisory  Board,  consisting  of  ten  representatives 
of  employers'  associations  and  ten  representatives  of 
trade  unions. 

National  Boards  of  Mediation  and  Investigation  are  to 
be  formed  only  in  disputes  involving  interstate  commerce 
and  in  those  cases  in  which  the  legislature  or  the  execu- 
tive of  a  State  has  requested  the  intervention  of  the  Fed- 
eral Government. 

The  Secretary  of  Labor,  or  in  the  States  the  official,  bu- 
reau or  commission  which  is  created  for  the  protection 
of  the  workers,  should  be  empowered  to  appear  before  the 
Board  of  Mediation  and  Investigation,  when  it  is  holding 
public  hearings,  either  at  the  request  of  the  Board  as 
amicus  curiae  in  the  ascertainment  of  facts  regarding 
labor  conditions,  or,  if  appealed  to,  as  the  spokesman  for 
the  employees  in  the  presentation  of  their  case. 


196 


PROPOSED  PLAN  OF  A  NATIONAL  SYSTEM  OF 

MEDIATION,  INVESTIGATION  AND 

ARBITRATION. 


ORGANIZATION. 

1.    Scope  of  Authority. 

The  National  Mediation  Commission  should  be  given  ex- 
clusive authority  to  intervene,  under  the  conditions  herein- 
after defined,  in  all  industrial  disputes  involving  any  cor- 
poration, firm,  or  establishment  except  public  service  estab- 
lishments, which  is  engaged  in  interstate  commerce  or  whose 
products  enter  into  interstate  or  foreign  commerce. 

This  provision  differentiates  its  functions  from  those  of  the 
Mediation  Commission  existing  at  present  under  the  New- 
lands  Act.  It  is  considered  desirable  for  the  present  to  pro- 
vide for  the  existence  of  the  two  commissions,  at  least  until 
the  proposed  commission  has  been  thoroughly  tested.  It  is 
believed  to  be  wise,  however,  to  provide  for  their  close  cooper- 
ation from  the  very  beginning,  with  the  idea  that  they  will 
ultimately  be  consolidated. 

It  will  be  noted  that  this  provision  also  will  have  the  effect 
of  supplanting  the  mediation  powers  which  are  now  vested  in 
the  Department  of  Labor.  There  is  no  desire  to  criticise  or 
belittle  the  past  activities  of  the  mediators  operating  under 
the  Department  of  Labor,  for  such  criticism  is  absolutely  un- 
warranted. It  is  also  freely  admitted  that  the  Department 
of  Labor  has  not  had  either  the  time  or  the  resources  neces- 
sary for  the  proper  development  of  this  function.  The  pro- 
posal is  made,  however,  primarily  upon  three  grounds  which 
seem  to  be  sound  and,  in  fact,  compelling :  First,  the  function 
of  mediation  depends  absolutely  upon  the  permanent  assur- 
ance of  impartiality.  The  Department  of  Labor  was  created 
to  represent  the  interests  of  labor  and  it  seems  not  only  in- 
evitable but  desirable  and  proper  that  the  Secretary  of  Labor 


197 

should  always  be  drawn  from  the  ranks  of  organized  labor. 
The  function  of  mediation  may  be  administered  with  absolute 
impartiality  under  any  particular  Secretary,  or  even  under 
every  Secretary,  and  yet  it  seems  impossible,  even  under  such 
conditions,  to  create  that  absolute  assurance  of  impartiality 
which  is  the  prime  essential.  Second,  it  is  the  prerogative  and 
duty  of  the  Department  of  Labor  to  act,  aggressively  if  need 
be,  for  the  protection  of  the  workers  at  all  times,  and  to  utilize 
every  resource  at  its  command  to  give  them  that  protection. 
The  Department  must  necessarily  be  greatly  impeded  in  such 
frankly  partisan  action,  it  would  seem,  if  it  must  at  the  same 
time  preserve  either  the  substance  or  the  shadow  of  impartial- 
ity in  carrying  out  its  function  of  mediation.  Third,  in  the 
bitterest  disputes,  where  the  public  interest  most  strongly 
demands  intervention,  mediation  is  seldom  successful,  and  a 
stage  is  quickly  reached  where  the  most  vital  necessity  is  for 
the  full  and  exact  facts  regarding  the  dispute,  in  order  that 
public  opinion  may  be  intelligently  formed  and  directed.  Ex- 
perience has  shown  that  such  facts  can  best  be  secured  fully, 
quickly,  and  effectively  through  the  medium  of  public  inquiry. 
This  means  that  the  inquiring  body  must  have  power  to  sum- 
mon witnesses,  compel  the  production  of  books  and  papers, 
and  compel  testimony,  or  the  proceeding  is  worse  than  a  farce. 
It  may  be  regarded  as  certain  that  such  powers  will  never  be 
entrusted  to  the  Department  of  Labor. 

2.  Membership. 

Tne  members  of  the  Mediation  Commission  should  be  ap- 
pointed by  the  President  with  the  advice  and  consent  of  the 
Senate.  The  members  should  represent  in  proper  balance  the 
interests  of  employers,  employees  and  the  public.  The  mem- 
bers should  serve  for  terms  of  six  years. 

3.  Advisory  Board. 

The  President  of  the  United  States  should  designate  an 
equal  number  of  leading  organizations  of  employers  and  lead- 
ing organizations  of  employees  to  appoint  representatives  to 
act  as  an  advisory  body  to  the  President,  to  Congress,  and 


198 

to  the  Mediation  Commission.  This  body,  designated  herein- 
after the  Advisory  Board,  should  give  advice  regarding  the 
duties  of  the  Commission,  the  administration  of  its  affairs  and 
the  selection  of  mediators,  and  be  empowered  to  make  recom- 
mendations regarding  legislation.  The  Advisory  Board  should 
also  prepare  lists  of  persons  who  may  be  called  upon  to  serve 
on  boards  of  arbitration  and  on  boards  of  mediation  and  in- 
vestigation. The  Advisory  Board  should  be  called  together 
at  least  once  a  year  by  the  Chairman  of  the  Mediation  Com- 
mission; it  should  have  an  organization  independent  of  the 
Commission  and  elect  its  own  chairman  and  secretary. 

The  members  of  the  Advisory  Board  should  be  paid  travel- 
ing and  other  necessary  expenses  and  such  compensation  as 
may  be  determined  upon.  Provision  should  be  made  for  the 
removal  of  members  by  the  organizations  which  they  repre- 
sent. 

4.  Subordinate  Officers  and  Assistants. 

The  Mediation  Commission  should  have  power  to  appoint, 
remove  at  pleasure,  and  fix  the  compensation  of  a  secretary 
(and  a  limited  number  of  clerks).  The  appointment  of  other 
officers  and  assistants,  such  as  mediators,  examiners,  investi- 
gators, technical  assessors,  experts,  disbursing  officer,  clerks 
and  other  employees,  should  be  subject  to  the  Civil  Service 
rules.  But  arrangements  should  be  made  to  have  the  exam- 
ination include  experience  and  other  proper  qualifications,  and 
to  give  the  Mediation  Commission  power  to  examine  all  candi- 
dates orally. 

POWERS,  DUTIES  AND  JURISDICTION. 

5.  In  Interstate  Commerce. 

(a)  Mediation:  Whenever  a  controversy  concerning  con- 
ditions of  employment  arises  between  employer  and  employees 
engaged  in  interstate  commerce  other  than  public  service  cor- 
porations, either  party  should  be  able  to  apply  to  the  chair- 
man of  the  Mediation  Commission  for  its  services  in  the  bring- 


199 

ing  about  of  an  amicable  adjustment  of  the  controversy.  Or 
the  chairman  of  the  Commission  should  be  authorized  to  offer, 
on  his  own  initiative,  the  services  of  the  mediators  of  the  Com- 
mission. If  efforts  to  bring  about  an  amicable  adjustment 
through  mediation  should  be  unsuccessful,  the  Commission 
should  at  once,  if  possible,  induce  the  parties  to  submit  their 
differences  to  arbitration. 

{b)  Arbitration:  Procedure  should  be  similar  to  that  out- 
lined in  the  Newlands  Act.  If  it  is  necessary  for  the  Media- 
tion Commission  to  appoint  arbitrators,  they  should  be  taken 
from  a  list  prepared  by  the  Advisory  Board. 

(c)  Boards  of  Mediation  and  Investigation:  If  the  par- 
ties to  the  controversy  can  not  be  induced  to  arbitrate,  and  if 
the  controversy  should  threaten  to  interrupt  the  business  of 
employers  and  employees  to  the  detriment  of  the  public  inter- 
est, the  Commission  should  be  authorized  to  request  the  two 
parties  to  consent  to  the  creation  of  a  Board  of  Mediation  and 
Investigation.  If  the  consent  of  the  parties  to  the  controversy 
is  secured,  the  Commission  shall  form  such  a  board.  Of  the 
three  members  of  the  Board,  one  should  be  selected  by  the  em- 
ployers, one  by  the  employees  and  a  third  on  the  recommenda- 
tion of  the  members  so  chosen.  If  either  side  fails  to  recom- 
mend a  member,  he  should  be  appointed  by  the  Commission. 
If  after  a  stated  time  the  third  member  is  not  recommended, 
the  Commission  should  select  him.  Appointments  to  boards 
of  mediation  and  investigation  shall  be  made  by  the  Commis- 
sion from  a  list  prepared  for  this  purpose  by  the  Advisory 
Board.  The  Board  of  Mediation  and  Investigation  should 
offer  its  friendly  offices  in  bringing  about  a  settlement  of  the 
dispute  through  mediation.  If  mediation  should  not  be  suc- 
cessful and  if  the  parties  to  the  controversy  refuse  to  arbi- 
trate, this  Board  should  have  power  to  make  an  investigation 
of  the  controversy,  and  should  be  required  to  submit  to  the 
Commission  a  full  report  thereon,  including  recommendations 
for  its  settlement.  The  Commission  should  be  empowered  to 
give  this  report  and  recommendations  adequate  publicity. 


200 

(d)  Powers  to  Secure  Evidence:  A  Board  of  Mediation 
and  Investigation  should  have  power  to  administer  oaths,  to 
subpoena  and  compel  the  attendance  and  testimony  of  wit- 
nesses and  the  production  of  books,  papers,  documents,  etc., 
and  to  conduct  hearings  and  investigations,  and  to  exercise 
such  other  similar  powers  as  might  be  necessary.  It  should 
not  have  power  to  prohibit,  or  to  impose  penalties  for,  strikes 
or  lockouts. 

6.    Not  in  Interstate  Commerce. 

It  should  be  provided  that  the  Commission,  or  a  Board  of 
Mediation  and  Investigation  created  by  it,  may  exercise  the 
foregoing  powers  except  the  compulsory  powers  under  sub- 
division "d"  of  Proposal  5,  for  settling  industrial  controver- 
sies between  parties  not  engaged  in  interstate  commerce,  if 
they  are  requested  to  do  so  by  the  Governor  or  legislature  of 
a  State,  or  by  the  mayor,  council,  or  commission  of  a  munici- 
pality. 

7.  The  Secretary  of  Labor  and  the  Secretary  of  Commerce 
should  be  authorized  to  bring  to  the  attention  of  the  Commis- 
sion any  dispute  in  which  the  intervention  of  the  Commission 
seems  desirable.  The  Secretary  of  Labor,  or  such  officer  as 
he  may  designate,  should  also  be  authorized  to  appear  before 
any  Board  of  Mediation  and  Investigation,  either  at  the  re- 
quest of  the  Board  as  amicus  curiae  for  the  ascertainment  of 
facts  regarding  labor  conditions,  or,  if  appealed  to,  as  a 
spokesman  for  the  employees  in  the  presentation  of  their  case. 


201 


COOPERATION. 

8.  Cooperation  with  State  and  Local  Authorities. 

The  Commission  should  be  authorized  and  directed  to  coop- 
erate with  State,  local  and  territorial  authorities  and  similar 
departments  of  foreign  countries  which  deal  with  the  adjust- 
ment of  industrial  disputes. 

9.  Cooperation  with  Other  Federal  Agencies. 

The  Commission  should,  as  far  as  practicable,  coordinate  its 
activities  and  cooperate  with  other  Federal  departments  in 
the  performance  of  their  duties. 


202 


XVI.     Industrial  Conditions  and  the  Public  Health — 
Sickness  Insurance. 

The  investigations  which  have  been  conducted  by  the  Com- 
mission under  the  direction  of  Dr.  B.  S.  Warren  of  the  Pub- 
lic Health  Service,  are  the  basis  for  the  following  conclusions : 

1.  Each  of  the  thirty-odd  million  wage  earners  in  the  United 
States  loses  an  average  of  nine  days  a  year  through  sick- 
ness. At  an  average  of  $2  per  day,  the  wage  loss  from 
this  source  is  over  $500,000,000. 

At  the  average  cost  of  medical  expenses  ($6  per  capita 
per  year)  there  is  added  to  this  at  the  very  least  $180,000,- 
000. 

2.  Much  attention  is  now  given  to  accident  prevention,  yet 
accidents  cause  only  one-seventh  as  much  destitution  as 
does  sickness  and  one-fifteenth  as  much  as  does  unemploy- 
ment. A  great  deal  of  unemployment  is  directly  due  to 
sickness,  and  sickness,  in  turn,  follows  unemployment. 
The  Commission's  recent  study  in  Indiana  showed  that 
17.9  per  cent  of  unemployment  among  women  in  stores  in 
that  State  was  due  to  illness.  In  1901,  a  Federal  investi- 
gation of  25,440  workmen's  families  showed  that  11.2  per 
cent  of  heads  of  families  were  idle  during  the  year  on  ac- 
count of  sickness  and  that  the  average  period  of  such  un- 
employment was  7.71  weeks.  Other  investigations  show 
that  30  to  40  per  cent  of  cases  requiring  charitable  relief 
are  immediately  due  to  sickness. 

3.  Sickness  among  wage  earners  is  primarily  the  direct  re- 
sult of  poverty,  which  manifests  itself  in  insufficient  diet, 
bad  housing,  inadequate  clothing,  and  generally  unfavor- 
able surroundings  in  the  home.  The  surroundings  at  the 
place  of  work  and  the  personal  habits  of  the  worker  are 
important  but  secondary  factors. 


203 

4.  There  are  three  general  groups  of  disease-causing  condi- 
tions: (1)  Those  for  which  the  employer  and  character 
of  the  industry  and  occupation  are  responsible;  (2)  those 
for  which  the  public,  through  regulatory  and  relief  agen- 
cies, is  responsible;  and  (3)  those  for  which  the  individual 
worker  and  his  family  are  responsible. 

5.  The  employers '  responsibility  includes,  besides  conditions 
causing  so-called  occupational  diseases,  low  wages,  exces- 
sive hours,  methods  causing  nervous  strain,  and  general 
insanitary  conditions. 

Many  employers  already  partly  recognize  their  respon- 
sibility; aside  from  " welfare  work,"  many  contribute  lib- 
erally to  employees '  sick  benefit  funds  or  provide  for  the 
entire  amount. 

6.  The  public  has  in  part  recognized  its  responsibility  in 
such  matters  as  housing,  water  supply,  foods,  drugs,  and 
sanitation.  But  the  recognition  of  responsibility  has  not 
been  thorough-going  and  in  the  case  of  local  health  offi- 
cers the  tendency  has  been  too  frequently  to  provide  for 
the  better  residential  sections  and  neglect  the  slums. 

7.  The  greatest  share  of  responsibility  rests  upon  the  indi- 
vidual, and  under  present  conditions  he  is  unable  to 
meet  it. 

This  inability  exists  by  reason  of  the  fact  that  the  ma- 
jority of  wage  earners  do  not  receive  sufficient  wages  to 
provide  for  proper  living  conditions,  and  because  the  pres- 
ent methods  of  disease  prevention  and  cure  are  expensive 
and  sickness  is  most  prevalent  among  those  who  are  least 
able  to  purchase  health.  The  worker  is  expected  to  pro- 
vide for  almost  certain  contingencies  in  the  future  when 
he  lacks  means  of  existing  adequately  in  the  present 

8.  If  we  might  reasonably  expect  a  rapid  increase  in  the 
wages  of  all  classes  of  workers  to  a  standard  which  would 
permit  proper  living  conditions  and  adequate  medical  at- 


204 

tention,  it  would  perhaps  be  inadvisable  to  recommend 
any  Governmental  action.  But  we  feel  assured  that  no 
such  condition  is  to  be  expected  in  the  near  future,  and 
believe  that  new  methods  of  dealing  with  th&  existing  evils 
must  be  adopted. 

9.  The  remedial  measures  for  existing  conditions  must  be 
based  on  the  cooperative  action  of  those  responsible  for 
conditions;  must  be  democratic  in  maintenance,  control, 
and  administration ;  must  distribute  costs  practicably  and 
justly ;  and  must  provide  a  powerful  incentive  for  sickness 
prevention. 

10.  A  system  of  sickness  insurance  is  the  most  feasible  sin- 
gle measure.    This  conclusion  is  based  on  the  following : 

a.  The  losses  occasioned  by  the  wage  earner's  sickness 
affect  employee,  employer,  and  community,  all  of 
whom  share  in  the  responsibility.  Insurance  is  the 
recognized  method  of  distributing  loss  so  as  to  reduce 
individual  risk  to  a  minimum. 

b.  The  strongest  of  incentives — that  of  lessening  cost — 
is  given  to  efforts  to  diminish  frequency  and  serious- 
ness of  losses ;  sickness  insurance  in  this  respect  is  a 
preventive  measure  of  a  positive  and  direct  kind. 
The  lower  the  morbidity  and  mortality  rates,  the  less 
the  amount  necessary  for  benefits  and  the  lower  the 
insurance  rate. 

c.  Sickness  insurance  is  no  longer  experimental,  but  is 
rapidly  becoming  universal.  It  is  not  a  novelty  even 
in  the  United  States.  Although  not  provided  for  nor 
subsidized  by  Government  here,  it  is  most  widely 
used,  there  being  several  million  workers  so  insured. 

d.  The  cost  would  be  no  greater  than  at  present.  The 
conclusion  appears  sound  that  medical  benefits  and 
minimum  cash  benefits  of  $7  per  week  for  a  period 
not  exceeding  26  weeks  in  one  year,  and  death  bene- 
fits of  $200,  can  be  provided  at  a  total  cost  of  50  cents 


205 

per  week  per  insured  person.  Budgetary  studies  of 
large  numbers  of  workingmen's  families  show  that 
under  present  conditions  from  25  and  50  cents  a 
week,  up  to  70  cents  and  even  $1.86,  is  spent  for  little 
more  than  burial  insurance.  Workers  would  thus 
receive  immeasurably  greater  benefits  for  much  less 
than  they  now  pay. 

11.  A  Governmental  system  of  sickness  insurance  is  prefer- 
able because — 

a.  More  democratic ;  the  benefits  would  be  regarded  as 
rights,  not  charity. 

b.  Compulsory  features,  obnoxious  under  private  in- 
surance, would  be  no  longer  objectionable. 

c.  On  account  of  the  reduction  in  overhead  charges 
and  duplication,  higher  efficiency  in  administration 
would  be  secured  at  less  cost. 

d.  Cooperation  with  other  public  agencies  is  imprac- 
ticable otherwise. 

e.  European  experience  has  proved  the  superiority  of 
Government  systems  to  private  insurance. 

/.  Taxation  of  industry  by  Federal  Government  in  sick- 
ness insurance  system  is  thoroughly  established  by 
the  Marine  Hospital  Service.  Law  taxing  vessels 
for  such  fund  was  passed  in  1798  and  its  constitu- 
tionality has  never  been  questioned. 

12.  The  conclusion  seems  warranted  that  a  sickness  insurance 
system  for  the  United  States  or  the  several  States,  sim- 
ilar in  general  principles  and  methods  to  the  best  Euro- 
pean systems,  will  be  less  difficult  and  radical  than  has 
been  foreboded.  It  will  not  so  much  introduce  new  ideas 
and  practices  as  it  will  organize  existing  plans  and  prin- 
ciples into  more  effective  accomplishment.  Existing 
agencies,  in  trade  unions,  mutual  benefit  societies,  and 
establishment  funds,  can  be  utilized  just  as  they  have 


206 

been  in  Europe.  The  real  problem  becomes  one  of  con- 
structive organization. 

It  is  suggested  that  the  Commission  recommend  a  Federal 
system  of  sickness  insurance,  constructed  along  the  lines  here 
briefly  summarized. 

1.  Membership.    The  membership  shall  comprise  all  employ- 

ees of  persons,  firms,  companies  and  corporations  engaged 
in  interstate  commerce,  or  whose  products  are  transported 
in  interstate  commerce,  or  which  may  do  business  in  two 
or  more  States.  The  employees  of  intrastate  establish- 
ments to  be  permitted  to  be  insured  if  they  so  elect,  un- 
der regulations  to  be  prescribed  by  the  Commission. 

2.  Fund.    The  fund  is  to  be  created  by  joint  contributions  by 

employees,  employers  and  the  Government,  the  last 
named  sufficient  for  expenses  of  administration.  Such 
contributions  should  probably  be  in  the  proportion  of  50 
per  cent  from  workers,  40  per  cent  from  employers,  and 
10  per  cent  from  the  Government.  Individuals  or  groups 
desiring  larger  benefits  may  arrange  to  make  larger  pay- 
ments, and  the  rate  in  any  trade,  industry  or  locality  may 
be  reduced  where  conditions  so  improve  as  to  make  a 
lower  rate  adequate.  The  contributions  are  to  be  se- 
cured through  taxing  each  interstate  employer  a  certain 
amount  weekly  for  each  employee,  the  part  contributed 
by  workers  to  be  deducted  from  their  wages,  thus  using 
the  regular  revenue  machinery  of  the  Government. 

3.  Benefits.    Benefits  to  be  available  for  a  limited  period  in 

the  form  of  cash  and  medical  benefits  during  sickness,  non- 
industrial  accidents  and  childbearing ;  death  benefits  to 
be  of  limited  size  and  payable  on  presentation  of  proper 
evidence. 

4.  Administration.     The  administration    of    the    insurance 

funds  is  to  be  carried  out  by  a  National  Sickness  Insur- 
ance Commission.    The  National  Commission  should  be 


207 

composed,  by  Presidential  appointment  with  Senate  con- 
firmation, of  a  director  (who  would  be  chairman),  repre- 
sentatives of  employers  and  representatives  of  employees 
in  equal  ratio,  and,  as  ex  officio  nonvoting  members,  the 
Federal  Commissioner  of  Labor  Statistics  and  the  Sur- 
geon General  of  the  Public  Health  Service.  The  Commis- 
sion should  be  empowered  to  supervise  all  funds  and  de- 
termine their  character  and  limits  of  jurisdiction;  pro- 
mulgate all  regulations  necessary  to  enforce  the  Act;  es- 
tablish and  maintain  hospitals ;  maintain  staffs  of  medical 
examiners,  specialists,  dentists,  and  visiting  nurses ;  pro- 
vide for  medicines  and  appliances;  make  contracts  with 
local  physicians;  cooperate  with  local  funds  and  health 
authorities  in  disease  prevention;  and  provide  for  col- 
lecting actuarial  data. 

Correlation  of  the  insurance  system  with  the  medical 
profession,  the  lack  of  which  has  been  a  serious  defect  in 
German  and  British  systems,  is  absolutely  necessary. 
Contracts  with  physicians  should  allow  to  each  a  per  cap- 
ita payment  for  the  insured  persons  under  his  care,  the 
right  of  selection  of  physician  to  be  retained  by  the  in- 
sured. For  the  signing  of  certificates  entitling  the  insured 
to  benefits,  and  for  treating  the  insured  in  hospitals,  the 
Surgeon  General  should  detail  physicians  from  the  Pub- 
lic Health  Service,  their  entire  time  to  be  given  to  these 
and  other  duties  (consulting  with  local  physicians,  en- 
forcing Federal  laws  and  regulations,  and  cooperating 
with  local  authorities). 


208 


XVII.     Education  in  Relation  to  Industry. 

The  report  dealing  with  this  question  has  been  presented 
by  Commissioner  Lennon,  and  is  printed  on  pages  265-275. 


209 


XVIII.     Scientific  Management. 

The  investigation  of  scientific  management  was  conducted 
by  Professor  Robert  F.  Hoxie,  with  the  expert  assistance  and 
advice  of  Mr.  Robert  Gr.  Valentine,  representing  the  employ- 
er's interest  in  management,  and  Mr.  John  P.  Frey,  repre- 
senting the  interests  of  labor.  The  investigation  grew  out  of 
public  hearings  held  by  the  Commission  during  the  spring  of 
1914,  at  which  the  almost  unqualified  opposition  of  labor  to 
scientific  management  was  manifested.  The  purpose  of  the 
investigation  was  to  test  by  the  results  of  actual  practice  the 
claims  of  scientific  management  and  the  charges  of  the  rep- 
resentatives of  organized  labor. 

The  investigation,  which  covered  a  period  of  more  than  a 
year,  was  made  with  the  greatest  care  and  thoroughness. 
Thirty-five  shops  and  systematizing  concerns  were  examined 
and  interviews  were  had  with  a  large  number  of  scientific  man- 
agement leaders,  experts  and  employers.  The  shops  visited 
were,  almost  without  exception,  those  designated  by  author- 
ities on  scientific  management,  such  as  Messrs.  Taylor,  Gantt, 
and  Emerson,  as  the  best  representatives  of  the  actual  results 
of  scientific  management.  In  other  words,  the  examination 
was  practically  confined  to  the  very  best  examples  of  scien- 
tific management.  The  defects  and  shortcomings  pointed  out 
hereinafter  are,  therefore,  characteristic  of  the  system  under 
the  most  favorable  conditions. 

As  a  result  of  their  investigations,  Prof.  Hoxie,  Mr.  Val- 
entine and  Mr.  Frey  submitted  a  report,  agreed  upon  without 
exceptions,  in  which  the  statements  and  recommendations 
which  follow  are  embodied.  These  statements  constitute  a 
very  brief  summary  of  the  entire  report,  which  should  be  read 
as  a  whole  if  a  complete  understanding  of  their  results  and 
findings  is  desired. 

Throughout  the  report  the  term  "scientific  management"  is 
understood  to  mean  the  system  devised  and  applied  by  Fred- 
erick W.  Taylor,  H.  L.  Gantt,  Harrington  Emerson  and  their 


210 


followers,  with  the  object  of  promoting  efficiency  in  shop  man- 
agement and  operation. 

The  report,  unanimously  agreed  upon  by  the  Commission's 
investigator  and  his  advisory  experts,  is  the  basis  for  the  fol- 
lowing statements. 


POSSIBLE  BENEFITS  OF  SCIENTIFIC  MANAGEMENT 
TO  LABOR  AND  SOCIETY. 

1.  As  a  system,  scientific  management  presents  certain  pos- 
sible benefits  to  labor  and  to  society : 

a.  A  close  causal  relation  exists  between  productive  effi- 
ciency and  possible  wages.  Greater  efficiency  and  output  make 
possible  higher  wages  in  general,  and  better  conditions  of  em- 
ployment and  labor. 

In  so  far  then  as  scientific  management  affords  opportune 
ties  for  lower  costs  and  increased  production  without  adding 
to  the  burden  of  the  workers  in  exhaustive  effort,  long  hours 
or  inferior  working  conditions,  it  creates  the  possibility  of 
very  real  and  substantial  benefits  to  labor  and  to  society. 

b.  It  is  the  policy  of  scientific  management,  as  a  prelimi- 
nary to  strictly  labor  changes,  to  bring  about  improvement 
and  standardization  of  the  material  equipment  and  productive 
organization  of  the  plant,  particularly : 

Machinery — installation,  repair,  operation. 
Tools — storage,  care,  delivery. 

Material  equipment — rearrangement  to  avoid  delays,  etc. 
Product — devices  for  economical   and   expeditious   han- 
dling and  routing. 

Processes  and  methods — elimination  of  waste  motions, 

improvement  of  accessories,  etc. 
Reorganization  of  managerial  staff  and  improvement  of 

managerial  efficiency. 


211 

Reorganization  of  sales  and  purchasing  departments  with 
a  view  to  broadening  and  stabilizing  the  market. 

Improvements  in  methods  of  storekeeping  and  regulation 
of  delivery,  surplus  stock,  etc. 

All  such  improvements  are  to  be  commended  and  investiga- 
tion shows  that  they  are  not  only  accepted  by  labor  without 
opposition,  but  are  in  fact  welcomed. 

2.  Scientific  management  in  its  direct  relation  to  labor  is  not 
devoid  of  beneficial  aspects,  inasmuch  as  it  is  to  a  large  extent 
an  attempt  at  immediate  standardization  of  labor  conditions 
and  relations.  It  may  also  serve  labor  by  calling  the  attention 
of  the  employer  to  the  fact  that  there  are  other  and  more  ef- 
fective ways  to  meet  severe  competition  than  by  "taking  it 
out  of  labor. ' ' 

It  is  true  that  scientific  management  and  organized  labor 
are  not  altogether  in  harmony  in  their  attitude  toward  stand- 
ardization of  labor  conditions  and  relations.  While  both  seek 
to  have  the  conditions  of  work  and  pay  clearly  defined  and 
definitely  maintained  at  any  given  moment,  they  differ  funda- 
mentally as  to  the  circumstances  which  may  justly  cause  the 
substitution  of  new  standards  for  old  ones.  Trade  unionism 
tends  to  hold  to  the  idea  that  standards  must  not  be  changed 
in  any  way  to  the  detriment  of  the  workers.  Scientific  man- 
agement, on  the  other  hand,  regards  changes  as  justified  and 
desirable  if  they  result  in  increase  of  efficiency,  and  has  pro- 
vided methods  such  as  time  study,  for  the  constant  suggestion 
of  such  changes. 

3.  The  same  may  be  said  of  many  other  major  claims  of 
scientific  management.  Whether  the  ideals  advocated  are  at- 
tained or  at  present  attainable,  and  whether  scientific  man- 
agers are  to  be  found  who  purposely  violate  them,  scientific 
management  has  in  these  claims  and  in  the  methods  upon 
which  they  are  based,  shown  the  way  along  which  we  may  pro- 
ceed to  more  advantageous  economic  results  for  labor  and  for 
society.    It  may  not  have  succeeded  in  establishing  a  practical 


212 

system  of  vocational  selection  and  adaptation,  but  it  has  em- 
phasized the  desirability  of  it;  it  may  not  set  the  task  with 
due  and  scientific  allowance  for  fatigue  so  that  the  worker  is 
guarded  against  overspeeding  and  overexertion,  but  it  has  un- 
doubtedly developed  methods  which  make  it  possible  to  better 
prevailing  conditions  in  this  respect;  it  has  called  attention 
most  forcibly  to  the  evils  of  favoritism,  and  the  rough  and 
arbitrary  decisions  of  foreman  and  others  in  authority.  If 
scientific  management  be  shown  to  have  positive  objectionable 
features,  from  both  the  standpoint  of  labor  and  the  welfare 
of  society,  this  constitutes  no  denial  of  these  beneficial  fea- 
tures, but  calls  rather  for  intelligent  social  action  to  eliminate 
that  which  is  detrimental  and  to  supplement  and  control  that 
which  is  beneficial  to  all. 


SCIENTIFIC  MANAGEMENT  IN  PRACTICE— ITS  DI- 
VERSITIES AND  DEFECTS. 

4.  Conditions  in  actual  shops  do  not  conform  to  the  ideals 
of  the  system,  and  show  no  general  uniformity.  Actual  field 
investigations  demonstrated  beyond  reasonable  doubt  that 
scientific  management  in  practice  is  characterized  by  striking 
incompleteness  and  manifold  diversity  as  compared  with  the 
theoretical  exposition  of  its  advocates.  This  incompleteness 
and  diversity  in  practice  apply  not  only  to  matters  of  detail, 
but  cover  many  of  the  essential  features  of  scientific  manage- 
ment even  among  those  shops  designated  by  Taylor,  Gantt, 
and  Emerson  as  representative  of  their  work  and  influence. 
The  following  particular  defects  were  observed: 

a.  Failure  to  carry  into  effect  with  any  degree  of  thorough- 
ness the  general  elements  involved  in  the  system.  This  may 
take  the  form  of  ignoring  either  the  mechanical  equipment  and 
managerial  organization,  adopting  simply  a  few  routine  fea- 
tures, such  as  time  study  and  bonus  payment,  or  the  adoption 
of  all  mechanical  features  with  a  complete  disregard  of  the 
spirit  in  which  they  are  supposed  to  be  applied. 


213 

b.  Failure  to  adopt  the  full  system  of  "functional  foreman- 
ship."  The  results  of  prevailing  practices  do  not  support  the 
claim  that  scientific  management  treats  each  workman  as  an 
independent  personality  and  that  it  substitutes  joint  obedience 
to  fact  and  law  for  obedience  to  personal  authority. 

c.  Lack  of  uniformity  in  the  method  of  selecting  and  hiring 
help.  Upon  the  whole  the  range  of  excellence  in  methods  of 
selection  and  hiring  in  "scientific"  shops  was  the  same  as  in 
other  shops.  The  workers  in  scientific  management  shops 
seem  to  be  a  select  class  when  compared  with  the  same  classes 
of  workers  outside,  but  this  result  seems  to  be  due  to  the  weed- 
ing out  of  the  less  satisfactory  material,  rather  than  to  initial 
methods  of  selection. 

d.  Failure  to  substantiate  claims  of  scientific  management 
with  reference  to  the  adaptation,  instruction  and  training  of 
workers.  Scientific  management  shops  in  general  depend  upon 
nothing  in  the  way  of  occupational  adaptation  of  the  workers 
except  the  ordinary  trial  and  error  method.  Investigation  re- 
veals little  to  substantiate  the  sweeping  claims  of  scientific 
managers  made  in  this  connection,  except  that  in  the  better 
scientific  management  shops,  many  workmen  are  receiving 
more  careful  instruction  and  a  higher  degree  of  training  than 
is  at  present  possible  for  them  elsewhere.  The  most  that  can 
be  said  is  that  scientific  management  as  such  furthers  a  ten- 
dency to  narrow  the  scope  of  the  workers '  industrial  activity, 
and  that  it  falls  far  short  of  a  compensatory  equivalent  in  its 
ideals  and  actual  methods  of  instruction  and  training. 

e.  Lack  of  scientific  accuracy,  uniformity  and  jtistice  in 
time  study  and  task  setting.  Far  from  being  the  invariable 
and  purely  objective  matters  that  they  are  pictured,  the  meth- 
ods and  results  of  time  study  and  task  setting  are  in  practice 
the  special  sport  of  individual  judgment  and  opinion,  subject 
to  all  the  possibilities  of  diversity,  inaccuracy  and  injustice 
that  arise  from  human  ignorance  and  prejudice. 

The  objects  of  time  study  are :    (1)  Improvement  and  stand- 


214 

ardization  of  the  methods  of  doing  the  work,  without  reference 
to  a  standard  time  for  its  accomplishment,  and  (2)  fixing  of  a 
definite  task  time  of  efficiency  scale. 

Possibilities  of  great  advantage  exist  in  the  use  of  time 
study  for  the  first  purpose.  However,  in  a  large  number  of 
shops,  time  study  for  this  purpose  is  practically  neglected. 

In  connection  with  the  second  purpose,  setting  of  task  time 
or  efficiency  scale,  great  variations  are  noted,  and  especially 
the  part  which  fallible  individual  judgment  and  individual 
prejudice  may  and  do  play. 

Detailed  observations  of  the  practice  of  making  time  studies 
and  setting  tasks  showed  great  variations  in  methods  and  re- 
sults. Seventeen  separate  sources  of  variation  are  pointed 
out,  any  one  of  which  is  sufficient  to  and  in  practice  does 
greatly  influence  the  results  of  time  studies. 

In  face  of  such  evidence  it  is  obviously  absurd  to  talk  of 
time  study  as  an  accurate  scientific  method  in  practice  or  of 
the  tasks  set  by  means  of  it  as  objective  scientific  facts  which 
are  not  possible  or  proper  subjects  of  dispute  and  bargaining. 

Furthermore,  the  time  study  men  upon  whom  the  entire  re- 
sults depend  were  found  to  be  prevailingly  of  the  narrow-mind- 
ed mechanical  type,  poorly  paid  and  occupying  the  lowest  posi- 
tions in  the  managerial  organization,  if  they  could  be  said  to 
belong  at  all  to  the  managerial  group.  Nor  does  the  situation 
seem  to  promise  much  improvement ;  for  the  position  and  pay 
accorded  to  time  study  men  generally,  are  such  as  to  preclude 
the  drawing  into  this  work  of  really  competent  men  in  the 
broader  sense.  Aside  from  a  few  notable  exceptions  in  the 
shops,  and  some  men  who  make  a  general  profession  of  time 
study  in  connection  with  the  installation  of  scientific  manage- 
ment, this  theoretically  important  functionary  as  a  rule  re- 
ceives little  more  than  good  mechanics'  wages,  and  has  little 
voice  in  determining  shop  policies.  In  fact,  the  time  study 
man,  who,  if  scientific  management  is  to  make  good  the  most 
important  of  its  labor  claims,  should  be  among  the  most  highly 
trained  and  influential  officials  in  the  shop,  a  scientist  in  view- 
point, a  wise  arbitrator  between  employer  and  workman,  is 


215 

in  general  a  petty  functionary,  a  specialist  workman,  a  sort 
of  clerk,  who  has  no  voice  in  the  counsels  of  the  higher  officials. 

However,  the  method  of  time  study  is  not  necessarily  im- 
practicable or  unjust  to  the  workers.  Under  proper  direc- 
tion time  study  promises  much  more  equitable  results  than 
can  be  secured  by  the  ordinary  methods.  The  greatest  essen- 
tial is  a  time  study  man  of  exceptional  knowledge,  judgment 
and  tact.  The  average  time  study  man  does  not  fulfill  these 
requirements  at  present. 

Finally,  it  is  only  in  connection  with  standard  products, 
requiring  only  moderate  skill  and  judgment  in  layout  and 
work,  that  economy  seems  to  allow  adequate  application  of 
the  time  study  method.  Its  natural  sphere  seems  to  be  routine 
and  repetitive  work.  As  long  as  industry  continues  to  be  as 
complex  and  diversified  as  it  is,  this  element  of  economy  will 
without  doubt  continue  to  operate  in  a  way  to  limit  the  legiti- 
mate scope  of  time  study  and  task  setting.  Task  setting  as 
at  present  conducted  is  not  satisfactory  to  workmen  and  cre- 
ates dissatisfaction  and  jealousy. 

/.  Failure  to  substantiate  the  claim  of  having  established 
a  scientific  and  equitable  method  of  determining  wage  rates. 

In  analyzing  the  wage  fixing  problem  in  connection  with 
scientific  management  two  matters  are  considered:  (1)  The 
"base  rate,"  sometimes  called  the  day  wage,  which  consti- 
tutes for  any  group  of  workers  the  minimum  earnings  or  indi- 
cates the  general  wage  level  for  that  group,  and  (2)  added 
"efficiency  payments,"  which  are  supposed  to  represent  spe- 
cial additional  rewards  for  special  attainments. .  - 

The  investigators  sought  in  vain  for  any  scientific  methods 
devised  or  employed  by  scientific  management  for  the  deter- 
mination of  the  base  rate,  either  as  a  matter  of  justice  between 
the  conflicting  claims  of  capital  and  labor,  or  between  the 
relative  claims  of  individuals  and  occupational  groups. 

Bates  for  women  with  reference  to  men  are  as  a  rule  on  the 
same  basis  in  scientific  management  shops  as  in  other  shops. 
One  leader  said,  "There  is  to  be  no  nonsense  about  scientific 


216 

management.  If  by  better  organization  and  administration, 
what  is  now  regarded  as  man's  work  can  be  done  by  women, 
women  will  be  employed  and  women's  wages  will  be  paid." 

Scientific  management  shops  seem  as  ready  as  others  to 
raise  the  rates  as  the  wage  level  generally  advances. 

"Bewildering  diversity"  prevails  in  relation  to  the  "effi- 
ciency payment"  or  reward  for  special  effort.  After  a  care- 
ful and  extended  analysis  and  investigation  of  the  different 
ways  of  rewarding  individual  increases  in  output,  it  was  con- 
cluded : 

All  of  these  systems  definitely  belie  the  claim  that  scientific 
management  pays  workers  in  proportion  to  their  efficiency. 
One  of  them  has  the  obvious  intent  of  weeding  out  the  lower 
grade  of  workers,  while  the  other  two  are  so  constituted  as 
to  make  such  workers  very  unprofitable  to  the  employers. 
Two  of  them  lend  themselves  easily  to  the  exploitation  of 
mediocre  workers — those  who  can  deliver  a  medium  output 
but  can  not  attain  to  a  standard  task  set  high.  All  of  them 
furnish  a  strong  stimulus  to  high  efficiency  and  output,  but  in 
themselves  furnish  no  visible  check  on  overspeeding  and  ex- 
haustion. All  of  them  are  capable  of  being  liberally  applied, 
but  all  can  also  be  used  as  instruments  of  oppression  through 
the  undue  severity  of  task  setting  or  efficiency  rating. 

There  can  be  no  doubt  that  under  scientific  management 
rates  are  cut.  But  to  say  positively  that  scientific  manage- 
ment, on  the  whole,  furthers  the  cutting  of  rates,  is  quite  an- 
other matter.  The  fact  seems  clear  that  at  this  point  there  is 
a  conflict  of  tendencies  within  the  thing  itself.  There  is  a 
strong  inducement  for  scientific  managers  to  maintain  rates 
strictly  and  the  honest  efforts  of  those  who  deserve  the  name 
to  so  maintain  them  can  hardly  be  impugned.  At  the  same 
time,  however,  the  greatest  advance  toward  efficiency,  for 
which  scientific  management  stands,  is  obtained  by  the  con- 
stant alteration  of  conditions  and  tasks  through  time  study. 
Such  alterations  almost  of  necessity  mean  constant  rate  cut- 
ting. Were  industry  once  standardized  for  good  and  all, 
scientific  management  would  undoubtedly  operate  as  an  un- 


217 

equivocal  force  tending  to  the  maintenance  of  rates.  As  it 
is  with  industry  in  flux,  what  amounts  to  rate  cutting  seems 
to  be  almost  of  necessity  an  essential  part  of  its  very  nature. 
Finally,  all  of  the  systems  of  payment  tend  to  center  the 
attention  of  the  worker  on  his  individual  interest  and  gain  and 
to  repress  the  development  of  group  consciousness  and  inter- 
est. Where  the  work  of  one  man  is  independent  of  another, 
the  individual  has  no  motive  to  consider  his  fellow,  since  his 
work  and  pay  in  no  wise  depend  on  the  other  man.  .What 
either  does  will  not  affect  the  other's  task  or  rates.  Where 
work  is  independent,  the  leader  can  not  afford  to  slow  down 
to  accommodate  his  successor. 

It  must  be  admitted  that  these  systems  are  admirably  suited 
to  stimulate  the  workers,  but  in  so  far  as  there  may  be  virtue 
in  the  union  principles  of  group  solidarity  and  uniformity, 
and  in  so  far  as  they  lay  claim  to  scientific  accuracy  or  a  spe- 
cial conformity  to  justice  in  reward,  they  must  be  judged 
adversely. 

g.  Failure  to  protect  the  workers  from  overexertion  and 
exhaustion.  It  is  claimed  by  scientific  management  that  pro- 
tection to  workers  is  afforded  by  such  devices  as :  Standard- 
ization of  equipment  and  performance;  substitution  of  exact 
knowledge  of  men  and  of  machines  for  guesswork  in  the  set- 
ting of  the  task  and  the  determination  of  the  hours  and  other 
conditions  of  work;  careful  studies  of  fatigue;  elimination 
of  the  need  for  pace  setters ;  transformation  of  speeders  into 
instructors,  and  transfer  of  responsibility  from  the  workers 
to  the  management  for  contriving  the  best  methods  of  work; 
maintenance  of  the  best  conditions  for  performing  work 
through  furnishing  the  best  tools  and  materials  at  the  proper 
time  and  place;  instruction  of  the  workers  in  the  most  eco- 
nomical and  easiest  methods  of  performing  operations ;  insti- 
tution of  rational  rest  periods  and  modes  of  recreation  dur- 
ing working  hours,  and  surrounding  the  workers  with  the 
safest  and  most  sanitary  shop  conditions. 

Investigation  indicates  that  scientific  management,  in  prac- 
tice, furnishes  no  reasonable  basis  for  the  majority  of  these 


218 

specific  claims  in  the  present,  and  little  hope  for  their  realiza- 
tion in  the  near  future.  In  these  matters,  indeed,  the  utmost 
variation  prevails  in  scientific  management  as  in  other  shops. 
Several  admirable  cases  were  found  with  respect  to  all  these 
matters,  but  shops  were  not  wanting  where  the  management 
exhibited  the  utmost  suspicion  of  the  workers,  referring  con- 
tinually to  their  disposition  to  "beat  the  time  study  man,"  al- 
though the  time  study  in  such  shops  was  obviously  based  on 
the  work  of  speeders  and  all  sorts  of  inducements  were  offered 
for  pace  setting,  where  instruction  and  training  of  the  workers 
were  emphasized  by  their  absence,  and  where  the  general  con- 
ditions of  the  work  were  much  in  need  of  improvement. 

The  investigation  seems  to  show  clearly  that  practical  scien- 
tific management  has  not  materially  affected  the  length  of  the 
working  day.  Aside  from  shops  where  the  management  was 
evidently  imbued  with  a  strong  moral  sense,  the  hours  of 
labor  in  these  shops  were  those  common  to  the  industry  and 
the  locality. 

When  we  come  to  the  matter  of  fatigue  studies  and  their 
connection  with  speeding  and  exhaustion,  the  claims  of  scien- 
tific management  seem  to  break  down  completely.  No  actual 
fatigue  studies  were  found  taking  place  in  the  shops,  and  the 
time  study  men,  who  should  be  charged  with  such  studies, 
seemed,  in  general,  to  be  quite  indifferent  or  quite  ignorant  in 
regard  to  this  whole  matter.  This  does  not  mean  that  no  at- 
tention to  fatigue  is  given  in  scientific  management  shops. 
Cases  were  found  where  the  health  and  energy  of  the  workers 
were  carefully  observed  and  attempts  were  made  to  adopt  the 
work  to  their  condition,  but  the  methods  employed  were  the 
rough-and-ready  ones  of  common  sense  observation.  Rest 
periods  and  modes  of  recreation  during  the  working  hours  are 
a  regular  institution  on  an  extended  scale  in  but  one  shop 
visited  by  the  investigators.  Isolated  instances  were  encoun- 
tered elsewhere,  but  managers,  in  general,  apparently  do  not 
even  entertain  the  idea  of  their  institution. 

Scientific  management  does  not  always  surround  the  work- 
ers with  the  safest  and  most  sanitary  shop  conditions.     In 


219 

general,  scientific  management  shops  seem  to  be  good  shops 
as  shops  go.  The  introduction  of  the  system  has  the  tendency 
without  doubt  to  clean  the  shop  up  and  to  improve  the  con- 
dition of  belting,  machinery  and  arrangement  of  material 
equipment  generally.  All  this  is  in  the  direct  line  of  efficiency 
and  safety.  Several  very  notable  examples  of  excellence  in 
safety  and  sanitation  were  found.  On  the  other  hand,  several 
shops  visited  were  below  good  standards  in  these  respects, 
and  flagrant  specific  violations  of  safety  rules  were  encoun- 
tered. 

As  a  whole,  the  facts  in  no  wise  justify  the  assumption  that 
scientific  management  offers  any  effective  guaranty  against 
overspeeding  and  exhaustion  of  workers.  The  investigation 
left  a  strong  impression  that  scientific  management  workers, 
in  general,  are  not  overspeeded,  but  the  challenge  to  show 
any  overspeeded  or  overworked  men  in  scientific  management 
shops  is  very  easily  met.  The  situation,  in  this  respect,  varies 
much  with  the  industry.  Some  instances  of  undoubted  over- 
speeding  were  found,  particularly  in  the  case  of  girls  and 
women.  But  these  instances  do  not  warrant  a  general  charge. 
On  the  other  hand,  there  appears  to  be  nothing  in  the  special 
methods  of  scientific  management  to  prevent  speeding  up 
where  the  technical  conditions  make  it  possible  and  profit- 
able, and  there  is  much  in  these  methods  to  induce  it  in  the 
hands  of  unscrupulous  employers. 

h.  Failure  to  substantiate  the  claim  that  scientific  man- 
agement offers  exceptional  opportunities  for  advancement  and 
promotion  on  a  basis  of  individual  merit.  While  scientific 
management  undoubtedly  separates  the  efficient  .from  the  in- 
efficient more  surely  and  speedily  than  ordinary  methods,  it 
was  shown  by  the  investigation  that  scientific  management 
often  fails  in  the  development  of  functional  foremanship  and 
in  the  elimination  of  favoritism.  It  tends  to  create  a  multi- 
tude of  new  tasks  on  which  less  skill  is  required  and  lower 
rates  can  be  paid.  It  has  developed  no  efficient  system  for  the 
placing  or  adaptation  of  the  workers.  It  is  inclined  in  prac- 
tice to  regard  a  worker  as  adapted  to  his  work  and  rightly 


220 

placed  when  he  succeeds  in  making  the  task.  It  tends  to  con- 
fine the  mass  of  workmen  to  one  or  two  tasks,  and  offers  little 
opportunity,  therefore,  for  the  discovery  and  development  of 
special  aptitudes  among  the  masses.  It  tends  to  divide  the 
workers  into  two  unequal  classes — the  few  who  rise  to  man- 
agerial positions  and  the  many  who  seem  bound  to  remain 
task  workers  within  a  narrow  field.  In  the  ideal  it  offers  op- 
portunity for  promotion  from  the  ranks,  and  this  works  out 
to  a  certain  extent  in  practice,  but  not  universally. 

There  is  a  great  deal  of  exaggeration,  too,  in  statements 
made  concerning  special  rewards  for  usable  suggestions. 
Few  of  the  shops  make  any  systematic  rewards  of  this  kind, 
and  where  this  is  the  case  the  rewards  are  usually  trivial.  In 
one  shop  the  investigator  was  shown  an  automatic  machine 
invented  by  a  workman,  which  did  the  work  of  several  hand 
workers.  "Did  he  receive  a  reward?"  was  asked.  "Oh, 
yes,"  came  the  answer,  "his  rate  of  pay  was  increased  from 
17  to  22  cents  per  hour." 

i.  With  reference  to  the  alleged  methods  and  severity  of 
discipline  under  scientific  management  the  "acrimonious 
criticism"  from  trade  unions  does  not  seem  to  be  warranted. 

In  theory,  the  scientific  managers  appear  to  have  the  best 
of  the  argument,  and  in  practice  the  investigation  showed  an 
agreeable  absence  of  rough  and  arbitrary  disciplinary  author- 
ity. When  the  tasks  were  liberally  set,  the  workers  were  found 
generally  operating  without  special  supervision  except  where 
instructions  or  assistance  were  needed.  Deductions  were  in- 
deed made  for  poor  work  and  destruction  of  materials,  but  in 
the  better  class  of  shops  apparently  with  no  greater  and  per- 
haps with  less  than  ordinary  severity. 

While  it  should  be  remembered  that  the  shops  selected  rep- 
resented probably  the  best  of  the  shops  operating  under  this 
system,  in  general,  it  would  seem  that  scientific  management 
does  lessen  the  rigors  of  discipline  as  compared  with  other 
shops  where  the  management  is  autocratic  and  the  workers 
have  no  organization. 

j.    Failure  to  substantiate  the  claim  that  workers  are  dis- 


221 

charged  only  on  just  grounds  and  have  an  effective  appeal  to 
the  highest  managerial  authority.  This  whole  matter  is  one 
in  which  neither  management  claims  nor  union  complaints 
seem  susceptible  of  proof,  but  the  investigation  indicates 
that  the  unions  have  legitimate  basis  for  charging  that  dis- 
charge is  generally  a  matter  of  arbitrary  managerial  au- 
thority. 

k.  Lack  of  democracy  under  scientific  management.  As  a 
result  of  the  investigation,  there  can  be  little  doubt  that  scien- 
tific management  tends  in  practice  to  weaken  the  power  of  the 
individual  worker  as  against  the  employer,  setting  aside  all 
questions  of  personal  attitude  and  the  particular  opportu- 
nities and  methods  for  voicing  complaints  and  enforcing  de- 
mands. It  gathers  up  and  transfers  to  the  management  the 
traditional  craft  knowledge  and  transmits  this  again  to  the 
workers  only  piecemeal  as  it  is  needed  in  the  performance  of 
the  particular  job  or  task.  It  tends  in  practice  to  confine  each 
worker  to  a  particular  task  or  small  cycle  of  tasks.  It  thus 
narrows  his  outlook  and  skill  to.  the  experience  and  training 
which  are  necessary  to  do  the  work.  He  is  therefore  easier 
of  displacement.  Moreover,  the  changing  of  methods  and  con- 
ditions of  work  and  the  setting  of  tasks  by  time  study  with  its 
assumption  always  of  scientific  accuracy  puts  the  individual 
worker  at  a  disadvantage  in  any  attempt  to  question  the  jus- 
tice of  the  demands  made  upon  him.  The  onus  of  proof  is 
upon  him  and  the  standards  of  judgment  are  set  up  by  the 
employer,  covered  by  the  mantle  of  scientific  accuracy. 

It  would  seem  also  that  scientific  management  tends,  on  the 
whole,  to  prevent  the  formation  of  groups  of  workers  within 
the  shop  with  recognized  common  interests,  and  to  weaken 
the  solidarity  of  those  which  exist.  Almost  everything  points 
to  the  strengthening  of  the  individualistic  motive  and  the 
weakening  of  group  solidarity.  Each  worker  is  bent  on  the 
attainment  of  his  individual  task.  He  can  not  combine  with 
his  fellows  to  determine  how  much  that  task  shall  be.  If  the 
individual  slows  down  he  merely  lessens  his  wages  and  preju- 
dices his  standing  without  helping  his  neighbor.    If  he  can 


222 

beat  the  other  fellow,  he  helps  himself  without  directly  affect- 
ing the  other's  task  or  pay.  Assistance,  unless  the  man  is  a 
paid  instructor,  is  at  personal  cost.  Special  rewards,  where 
offered,  are  for  the  individual.  Rules  of  seniority  are  not 
recognized.  Sometimes  personal  rivalry  is  stimulated  by  the 
posting  of  individual  records  or  classification  of  the  workers 
by  name  into  Excellent,  Good,  Poor,  etc.  Potential  groups  are 
broken  up  by  the  constant  changes  in  methods  and  reclassifica- 
tion of  workers  which  are  the  mission  of  time  study.  The 
whole  gospel  of  scientific  management  to  the  worker  is  to  the 
individual,  telling  him  how,  by  special  efficiency,  he  can  cut 
loose  from  the  mass,  and  rise  in  wages  or  position. 

With  the  power  of  the  individual  weakened,  and  the  chances 
lessened  for  the  development  of  groups  and  group  solidarity, 
the  democratic  possibility  of  scientific  management,  barring 
the  presence  of  unionism,  would  seem  to  be  scant.  The  indi- 
vidual is  manifestly  in  no  position  to  cope  with  the  employer 
on  a  basis  «f  equality.  The  claim  to  democracy  based  on  the 
close  association  of  the  management  and  the  men  and  the  op- 
portunities allowed  for  the  voicing  of  complaints  is  not  borne 
out  by  the  facts,  and  in  the  general  run  of  scientific  manage- 
ment shops,  barring  the  presence  of  unionism  and  collective 
bargaining,  the  unionists  are  justified  in  the  charge  that  the 
workers  have  no  real  voice  in  hiring  and  discharging,  the  set- 
ting of  the  task,  the  determination  of  the  wage  rates,  or  the 
general  conditions  of  employment.  This  charge  is  true  even 
where  the  employers  have  no  special  autocratic  tendencies, 
much  more  so  therefore  where,  as  in  many  cases,  they  are 
thoroughly  imbued  with  the  autocratic  spirit.  With  rare  ex- 
ceptions, then,  democracy  under  scientific  management  can 
not  and  does  not  exist  apart  from  unionism  and  collective  bar- 
gaining. 

Does  the  scientific  manager,  as  a  matter  of  fact,  welcome 
the  cooperation  of  unionism?  Here,  again,  the  facts  should 
decide  the  contention.  The  fact  is  that  while  in  numbers  of 
scientific  management  shops  some  unionists  are  employed, 
they  are  not  generally  employed  as  union  men,  and  the  union 


223 

is  rarely  recognized  and  dealt  with  as  such.  The  fact  is  that 
those  who  declare  the  willingness  of  scientific  management  to 
welcome  the  cooperation  of  unionism,  in  general,  either  know 
nothing  about  unionism  and  its  rules  and  regulations,  or  are 
thinking  of  a  different  kind  of  unionism  from  that  to  which 
the  American  Federation  of  Labor  stands  committed,  and  a 
kind  of  cooperation  foreign  to  its  ideals  and  practices. 

To  sum  up,  scientific  management  in  practice  generally 
tends  to  weapen  the  competitive  power  of  the  individual 
worker,  and  thwarts  the  formation  of  shop  groups  and  weak- 
ens group  solidarity;  moreover,  generally  scientific  manage- 
ment is  lacking  in  the  arrangements  and  machinery  necessary 
for  the  actual  voicing  of  the  workers'  ideas  and  complaints, 
and  for  the  democratic  consideration  and  adjustment  of  griev- 
ances. Collective  bargaining  has  ordinarily  no  place  in  the 
determination  of  matters  vital  to  the  workers,  and  the  atti- 
tude toward  it  is  usually  tolerant  only  when  it  is  not  under- 
stood. Finally  unionism,  where  it  means  a  vigorous  attempt 
to  enforce  the  viewpoint  and  claims  of  the  workers,  is  in  gen- 
eral looked  upon  with  abhorrence,  and  unions  which  are  looked 
upon  with  complacency  are  not  the  kind  which  organized  labor, 
in  general,  wants,  while  the  union  cooperation  which  is  invited 
is  altogether  different  from  that  which  they  stand  ready  to 
give.  In  practice,  scientific  management  must,  therefore,  be 
declared  autocratic  in  tendency — a  reversion  to  industrial 
autocracy,  which  forces  the  workers  to -depend  on  the  employ- 
ers' conception  of  fairness,  and  limits  the  democratic  safe- 
guards of  the  workers. 

5.  Scientific  management  is  still  in  its  infancy  or  early  trial 
stages,  and  immaturity  and  failure  to  attain  ideals  in  prac- 
tice are  necessary  accompaniments  to  the  development  of  any 
new  industrial  or  social  movement.  Doubtless  many  of  its 
diversities  and  shortcomings  will,  therefore,  be  cured  by  time. 

Before  this  can  be  brought  about,  however,  certain  potent 
causes  of  present  evil  must  be  eradicated : 

a.  The  first  of  these  is  a  persistent  attempt  on  the  part  of 
experts  and  managers  to  apply  scientific  management  and  its 
methods  outside  their  natural  sphere. 


224 

b.  A  second  chief  source  of  danger  and  evil  to  labor  in  the 
application  of  scientific  management  is  that  it  offers  its  wares 
in  the  open  market,  but  it  has  developed  no  means  by  which 
it  can  control  the  use  of  these  by  the  purchaser.  In  large 
part,  the  practical  departure  of  scientific  management  from 
its  ideals  is  the  result  of  special  managerial  or  proprietorial 
aims,  and  impatience  of  delay  in  their  fulfillment.  The  expert 
is  frequently  called  in  because  the  establishment  is  in  financial 
or  industrial  straits,  and  the  chief  concern  of  the  manage- 
ment is  quick  increase  of  production  and  profits.  It  must 
meet  its  competitors  here  and  now,  and  can  not  afford  to  ex- 
pend more  than  is  necessary  to  do  this,  or  to  forego  immedi- 
ate returns  while  the  foundations  are  being  laid  for  a  larger 
but  later  success,  and  with  careful  regard  to  immediate  justice 
and  the  long-time  welfare  of  its  working  force.  The  outcome 
frequently  is  conflict  between  the  systematizer  and  the  man- 
agement, resulting  in  the  abandonment  of  the  scheme  only 
partially  worked  out  on  the  retirement  of  the  expert,  leaving 
the  management  to  apply  crudely  the  methods  partially  in- 
stalled, sometimes  to  the  detriment  of  the  workers  and  their 
interests. 

It  is  true  that  the  situation  thus  outlined  is  not  of  universal 
application.  But  bitter  complaints  were  frequently  heard 
from  members  of  the  small  group  of  experts  who  represent 
the  highest  ideals  and  intelligence  of  the  movement,  in  regard 
to  the  managerial  opposition  which  they  have  encountered, 
and  frequent  apologies  were  offered  for  the  conditions  and 
results  of  their  work,  accompanied  by  the  statement  that  they 
could  go  no  further  than  the  management  would  allow,  or 
that  things  had  been  done  by  the  management  against  their 
judgment  and  for  which  they  could  not  stand.  Moreover, 
scientific  management  is  closely  interlocked  with  the  mechan- 
ism of  production  for  profit  and  the  law  of  economy  rules. 
Many  things  which  would  be  desirable  from  the  ideal  stand- 
point, and  which  are  a  practical  necessity  if  the  interests  of 
the  workers  are  to  be  fully  protected,  are  not  always  or  usu- 
ally economical.  This  is  specially  true  of  time  study,  task 
setting  and  rate  making. 


225 

The  arbitrary  will  of  the  employer  and  the  law  of  economy 
are  two  potent  special  forces  which  contribute  to  the  existing 
diversity,  incompleteness  and  crudity  of  scientific  manage- 
ment as  it  is  practiced,  even  where  the  systematizer  is  pos- 
sessed of  the  highest  intelligence  and  imbued  with  the  best 
motives  of  his  group. 

c.  But  to  explain  the  situation  as  it  exists  at  present,  two 
other  important  factors  must  be  taken  into  consideration.  The 
first  of  these  is  the  existence  and  practice  of  self-styled  scien- 
tific management  systematizers  and  time  study  experts  who 
lack  in  most  respects  the  ideals  and  the  training  essential  to 
fit  them  for  the  work  which  they  claim  to  be  able  to  do.  Scien- 
tific management  as  a  movement  is  cursed  with  fakirs.  The 
great  rewards  which  a  few  leaders  in  the  movement  have  se- 
cured for  their  services  have  brought  into  the  field  a  crowd 
of  industrial  "patent  medicine  men."  The  way  is  open  to  all. 
No  standards  or  requirements,  private  or  public,  have  been 
developed  by  the  application  of  which  the  goats  can  be  sep- 
arated from  the  sheep.  Employers  have  thus  far  proved 
credulous.  Almost  anyone  can  show  the  average  manufactur- 
ing concern  where  it  can  make  some  improvements  in  its  meth- 
ods. So  the  scientific  management  shingles  have  gone  up  all 
over  the  country,  the  fakirs  have  gone  into  the  shops,  and  in 
the  name  of  scientific  management  have  reaped  temporary 
gains  to  the  detriment  of  both  the  employers  and  the  workers. 

d.  Fake  scientific  management  experts,  however,  are  not 
alone  responsible  for  the  lack  of  training  and  intelligence 
which  contributes  to  the  diversity  and  immaturity  of  scien- 
tific management  in  practice  and  its  failure  to  make  good  the 
labor  claims  of  its  most  distinguished  leaders.  The  fact  is 
that  on  the  whole,  and  barring  some  notable  exceptions,  the 
sponsors  and  adherents  of  scientific  management — experts 
and  employers  alike — are  profoundly  ignorant  of  very  much 
that  concerns  the  broader  humanitarian  and  social  problems 
which  it  creates  and  involves,  especially  as  these  touch  the 
character  and  welfare  of  labor. 

It  is  because  of  this  ignorance  and  unwarranted  assurance 


226 

that  there  is  a  strong  tendency  on  the  part  of  scientific  man- 
agement experts  to  look  npon  the  labor  end  of  their  work  as 
the  least  difficult  and  requiring  the  least  careful  consideration. 
To  their  minds,  the  delicate  and  difficult  part  of  the  task  of 
installation  is  the  solution  of  the  material,  mechanical  and 
organic  problems  involved.  They  tend  to  look  upon  the  labor 
end  of  their  work  as  a  simple  technical  matter  of  so  setting 
tasks  and  making  rates  that  the  workers  will  give  the  fullest 
productive  cooperation.  They  tend  naively  to  assume  that 
when  the  productivity  of  the  concern  is  increased  and  the 
laborers  are  induced  to  do  their  full  part  toward  this  end,  the 
labor  problem  in  connection  with  scientific  management  is  sat- 
isfactorily solved.  In  short,  in  the  majority  of  cases,  the  labor 
problem  appears  to  be  looked  at  as  one  aspect  of  the  general 
problem  of  production  in  the  shop,  and  it  is  truthfully  as- 
sumed that  if  it  is  solved  with  reference  to  this  problem,  it 
must  also  be  solved  with  due  regard  to  labor's  well-being  and 
its  just  demands.  This  seems  to  have  been  the  characteristic 
attitude  of  scientific  management  from  the  beginning.  Labor 
was  simply  looked  upon  as  one  of  the  factors  entering  into 
production,  like  machinery,'  tools,  stores  and  other  elements 
of  equipment.  The  problem  was  simply  how  to  secure  an 
efficient  coordination  and  functioning  of  these  elements.  It 
was  only  after  the  opposition  of  labor  had  been  expressed  that 
scientific  management  began  to  be  conscious  of  any  other  as- 
pect of  the  labor  matter.  And  with  some  notable  exceptions 
scientific  management  experts  and  employers  still  look  upon 
the  labor  matter  almost  solely  as  an  aspect  of  the  general  pro- 
duction problem,  and  have  little  positive  interest  or  concern 
in  regard  to  it  otherwise. 

It  is  probable  that  scientific  managers  will  object  to  these 
statements,  pleading  that  they  are  mainly  variations  and  con- 
ditions due  to  the  time  element,  or  to  the  necessity  imposed 
by  the  law  of  costs.  They  will  say,  for  example,  that  when 
a  new  and  unusual  job  comes  in,  neither  time  nor  economy 
will  allow  of  careful  time  studies,  and  if  careful  studies  were 
made  of  all  the  variations  of  a  complicated  task,  the  expense 
of  such  studies  would  wipe  out  the  profit;  that,  in  general, 


227 

they  are  proceeding  toward  the  full  realization  of  the  ideal  of 
scientific  management  as  fast  as  economy  will  allow.  But  such 
pleas  would  serve  only  to  confirm  the  main  contention  that 
scientific  managers  and  scientific  management  employers  gen- 
erally are  necessarily  ruled,  like  all  members  of  the  employ- 
ing group,  by  the  forces  of  cost  and  profits,  that  to  them  the 
labor  problem  is  primarily  an  aspect  of  the  problem  of  produc- 
tion, and  that  in  the  ends  the  needs  and  welfare  of  labor  must 
be  subordinated  to  these  things.  Beneath  all  other  causes  or 
shortcomings  of  scientific  management,  therefore,  in  its  rela- 
tion to  labor,  there  seems  to  be  the  practical  fact  of  an  oppo- 
sition of  interests  between  the  profit-taking  and  the  labor 
group,  which  makes  extremely  doubtful  the  possibility  that 
its  shortcomings  from  the  standpoint  of  labor  are  capable  of 
elimination. 

GENERAL  LABOR  PROBLEMS. 

6  a.  Scientific  management,  at  its  best,  furthers  the  mod- 
ern tendency  toward  the  specialization  of  the  workers.  Its 
most  essential  features — functional  foremanship,  time  study, 
task  setting  and  efficiency  payment — all  have  this  inherent 
effect. 

Under  the  scientific  management  system  fully  developed, 
the  ordinary  mechanic  is  intended  to  be  and  is,  in  fact,  a 
machine  feeder  and  a  machine  feeder  only,  with  the  possi- 
bility of  auxiliary  operations  clearly  cut  off  and  with  means 
applied  to  discourage  experimentation.  And  what  applies 
to  the  machine  feeder  applies  with  more  or  less  thoroughness 
to  machine  and  hand  operatives  generally. 

But  it  is  not  merely  in  stripping  from  the  job  its  auxiliary 
operations  that  scientific  management  tends  to  specialize  the 
work  and  the  workmen.  Time  study,  the  chief  cornerstone 
of  all  systems  of  scientific  management,  tends  inherently  to 
the  narrowing  of  the  job  or  task  itself.  As  the  final  object 
of  time  study,  so  far  as  it  directly  touches  the  workers,  is  to 
make  possible  the  setting  of  tasks  so  simple  and  uniform  and 
so  free  from  possible  causes  of  interruption  and  variation 


228 

that  definite  and  invariable  time  limits  can  be  placed  upon 
them,  and  that  the  worker  may  be  unimpeded  in  his  efficient 
performance  of  them  by  the  necessity  for  questioning  and 
deliberation,  the  preponderating  tendency  of  time  study  is  to 
split  up  the  work  into  smaller  and  simpler  operations  and 
tasks.  Decidedly,  then,  time  study  tends  to  further  the  mod- 
ern tendency  toward  specialization  of  the  job  and  the  task. 

With  functional  foremanship  lopping  off  from  the  job  auxil- 
iary operations,  and  time  study  tending  to  a  narrowing  of  the 
task  itself,  task  setting  and  efficiency  methods  of  payment 
come  into  play  as  forces  tending  to  confine  the  worker  to  a 
single  task  or  a  narrow  range  of  operations.  The  worker  is 
put  upon  the  special  task  for  which  he  seems  best  adapted, 
and  he  is  stimulated  by  the  methods  of  payment  employed  to 
make  himself  as  proficient  as  possible  at  it.  When  he  suc- 
ceeds in  this,  to  shift  him  to  another  task  ordinarily  involves 
an  immediate  and  distinct  loss  to  the  employer,  and  the  worker 
himself  naturally  resents  being  shifted  to  a  new  task  since 
this  involves  an  immediate  loss  in  his  earnings.  Here  worker 
and  employer  are  as  one  in  their  immediate  interest  to  have 
the  job  so  simple  that  the  operation  can  be  quickly  learned, 
and  the  task  made,  and  that  shifting  of  tasks  be  eliminated  as 
far  as  possible.  The  employer  besides  has  another  motive  for 
this,  in  that  the  shifting  of  the  workers  multiplies  the  records 
and  renders  more  complex  the  system  of  wage  accounting. 
It  is  true  that  the  scientific  management  employer,  like  any 
other,  must  have  a  certain  number  of  workers  in  the  shop  who 
are  capable  of  performing  a  plurality  of  tasks.  But  the  ten- 
dency is  to  have  as  few  all-round  workers  as  are  necessary  to 
meet  these  emergencies.  The  methods  of  scientific  manage- 
ment operate  most  effectively  when  they  break  up  and  nar- 
row the  work  of  the  individual,  and  the  ends  of  scientific  man- 
agement are  best  served  when  the  rank  and  file  of  the  workers 
are  specialists. 

This  inherent  tendency  of  scientific  management  to  special^ 
ization  is  buttressed,  broadened  in  its  scope  and  perpetuated 
by  the  progressive  gathering  up  and  systematizing  in  the 
bands  of  the  employers  of  all  the  traditional  craft  knowledge 


229 

in  the  possession  of  the  workers.  With  this  information  in 
hand  and  functional  foremanship  to  direct  its  use,  scientific 
management  claims  to  have  no  need  of  craftsmen,  in  the  old 
sense  of  the  term,  and,  therefore,  no  need  for  an  apprentice- 
ship system  except  for  the  training  of  functional  foremen. 
It  therefore  tends  to  neglect  apprenticeship  except  for  the 
training  of  the  few.  And  as  this  body  of  systematized  knowl- 
edge in  the  hands  of  the  employer  grows,  it  is  enabled  to 
broaden  the  scope  of  its  operation,  to  attack  and  specialize 
new  operations,  new  crafts  and  new  industries,  so  that  the 
tendency  is  to  reduce  more  and  more  to  simple,  specialized 
operations,  and  more  and  more  workers  to  the  positions  of 
narrow  specialists.  Nor  does  scientific  management  afford 
anything  in  itself  to  check  or  offset  this  specialization  ten- 
dency. The  instruction  and  training  offered  is  for  specialist 
workmen.  Selection  and  adaptation  are  specializing  in  their 
tendencies.  Promotion  is  for  the  relatively  few.  The  whole 
system,  in  its  conception  and  operation,  is  pointed  toward  a 
universally  specialized  industrial  regime. 

b.  But  scientific  management  is  not  only  inherently  spe- 
cializing; it  also  tends  to  break  down  existing  standards  and 
uniformities  set  up  by  the  workmen,  and  to  prevent  the  estab- 
lishment of  stable  conditions  of  work  and  pay.  Time  study 
means  constant  and  endless  change  in  the  method  of  opera- 
tion. No  sooner  is  a  new  and  better  method  discovered  and 
established  and  the  condition  of  work  and  pay  adapted  to  it 
than  an  improvement  is  discovered  involving  perhaps  new 
machinery,  new  tools,  and  materials,  a  new  way  of  doing 
things,  and  a  consequent  alteration  of  the  essential  conditions 
of  work  and  pay,  and  perhaps  a  reclassification  of  the  workers. 

c.  Ample  evidence  to  support  this  analysis  was  afforded 
by  the  investigation.  Where  the  system  was  found  relatively 
completely  applied,  the  mass  of  the  workers  were  engaged  in 
specialized  tasks,  there  was  little  variation  in  the  operations 
except  in  emergencies,  apprenticeship  for  the  many  was  aban- 
doned or  was  looked  upon  as  an  investment  which  brought  no 
adequate  returns  and  was  slated  for  abandonment;  almost 


230 

everywhere  scientific  management  employers  expressed  a 
strong  preference  for  specialist  workmen,  old  crafts  were 
being  broken  up  and  the  craftsmen  given  the  choice  of  re- 
tirement or  of  entering  the  ranks  of  specialized  workmen;  in 
the  most  progressive  shops,  the  time  study  men  were  prepar- 
ing the  way  for  a  broader  application  of  the  system  by  the 
analytical  study  of  the  operations  and  crafts  not  yet  system- 
atized. Changes  in  methods  and  classification  of  workers  were 
seen  even  during  the  short  course  of  the  investigation. 

d.  What  does  this  mean  from  the  standpoint  of  labor  and 
labor  welfare?  Certain  conclusions  are  inevitable.  Scien- 
tific management,  fully  and  properly  applied,  inevitably  tends 
to  the  constant  breakdown  of  the  established  crafts  and  crafts- 
manship and  the  constant  elimination  of  skill  in  the  sense  of 
narrowing  craft  knowledge  and  workmanship  except  for  the 
lower  orders  of  workmen.  Some  scientific  management  em- 
ployers have  asserted  belief  in  their  ability  to  get  on  a  paying 
basis  within  three  months,  should  they  lose  their  whole  work- 
ing force  except  the  managerial  staff  and  enough  others  to 
maintain  the  organization,  if  they  had  to  begin  all  over  again 
with  green  hands.  What  this  means  in  increased  competition 
of  workmen  with  workmen  can  be  imagined.  Were  the  scien- 
tific management  ideal  fully  realized,  any  man  who  walks  the 
street  would  be  a  practical  competitor  for  almost  any  work- 
man's job. 

Such  a  situation  would  inevitably  break  down  the  basis  of 
present-day  unionism  and  render  collective  bargaining  im- 
possible in  any  effective  sense  in  regard  to  the  matters  con- 
sidered by  the  unions  most  essential.  It  has  been  proved  by 
experience  that  unskilled  workers  generally  find  it  most  diffi- 
cult to  maintain  effective  and  continuous  organization  for 
dealing  with  complicated  industrial  situations.  Effective  col- 
lective bargaining  can  not  exist  without  effective  organization. 
Moreover,  we  have  already  seen  how  scientific  management, 
apart  from  the  matter  of  skill,  tends  to  prevent  the  formation 
and  weakens  the  solidarity  of  groups  within  the  shops. 

But  beyond  all  this,  time  study  strikes  at  the  heart  and  core 


231 

of  the  principles  and  conditions  which  make  effective  unionism 
and  collective  bargaining  possible  with  respect  to  certain  most 
essential  matters.  When  the  employer  can  constantly  initiate 
new  methods  and  conditions  and  reclassify  the  work  and  the 
workmen,  he  can  evade  all  efforts  of  the  union  to  establish 
and  maintain  definite  and  continuous  standards  of  work  and 
pay.  Time  study  is  in  definite  opposition  to  uniformity  and 
stable  classification.  It  enables  the  employer  constantly  to 
lop  off  portions  of  the  work  from  a  certain  class  and  then  to 
create  new  classifications  of  workers,  with  new  conditions  of 
work  and  pay.  Add  to  ail  of  this  the  advantage  gained  by  the 
employers  in  the  progressive  gathering  up  and  systematiza- 
tion  of  craft  knowledge  for  their  own  uses,  and  the  destruction 
of  apprenticeship  which  cuts  the  workers  off  from  the  perpetu- 
ation among  them  of  craftsmanship,  and  the  destructive  ten- 
dencies of  scientific  management  as  far  as  present-day  union- 
ism and  collective  bargaining  are  concerned,  seems  inevitable. 

e.  Under  these  circumstances,  the  progressive  degenera- 
tion of  craftsmanship  and  the  progressive  degradation  of 
skilled  craftsmen  also  seems  inevitable. 

/.  The  ultimate  effects  of  scientific  management,  should  it 
become  universal,  upon  wages,  employment,  and  industrial 
peace,  are  matters  of  pure  speculation.  During  the  period  of 
transition,  however,  there  can  be  little  doubt  of  the  results. 
The  tendency  will  be  first  toward  a  realignment  of  wage  rates. 
The  craftsmen,  the  highly  trained  workers,  can  not  hope  to 
maintain  their  wage  advantage  over  the  semiskilled  and  less 
skilled  workers.  There  will  be  a  leveling  tendency.  Whether 
this  leveling  will  be  up  or  down,  it  is  impossible  to  say.  At 
present  scientific  management  seems  to  be  making  the  rela- 
tively unskilled  more  efficient  than  ever  before,  and  they  are  in 
general  receiving  under  it  greater  earnings  than  ever  before. 
It  is  evident,  however,  that  the  native  efficiency  of  the  work- 
ing class  must  suffer  from  the  neglect  of  apprenticeship. 
Scientific  managers  have  themselves  complained  bitterly  of 
the  poor  material  from  which  they  must  recruit  their  workers, 
compared  with  the  efficient  and  self-respecting  craftsman  who 
applied  for  employment  twenty  years  ago. 


232 

Moreover,  it  must  not  be  overlooked  that  the  whole  scheme 
of  scientific  management  and  especially  the  gathering  up  and 
systematizing  of  the  knowledge  formerly  the  possession  of 
the  workmen,  tends  enormously  to  add  to  the  strength  of  cap- 
italism. This  fact,  together  with  the  greater  ease  of  displace- 
ment shown  above,  must  make  the  security  and  continuity  of 
employment  inherently  more  uncertain. 

If  generally  increased  efficiency  is  the  result  of  scientific 
management,  unemployment  would  in  the  end  seem  to  become 
less  of  a  menace.  But  during  the  period  of  transition  its  in- 
crease should  be  expected.  Not  only  must  the  old  craftsmen 
suffer  as  the  result  of  the  destruction  of  their  crafts,  but  until 
scientific  management  finds  itself  able  to  control  markets,  its 
increased  efficiency  must  result  in  gluts  in  special  lines  with 
resulting  unemployment  in  particular  trades  and  occupations. 
A  leading  scientific  management  expert  has  stated  that  one 
shop  of  six  in  a  certain  industry  systematized  by  him  could 
turn  out  all  the  product  that  the  market  would  carry.  The  re- 
sult to  the  workers,  if  the  statement  be  true,  needs  no  explana- 
tion. Scientific  management  would  seem  to  offer  possibilities 
ultimately  of  better  market  control  or  better  adaptation  to 
market  conditions,  but  the  experience  of  the  past  year  of  de- 
pression indicates  that  at  present  no  such  possibilities  gen- 
erally exist. 

Finally,  until  unionism  as  it  exists  has  been  done  away  with 
or  has  undergone  essential  modification,  scientific  manage- 
ment can  not  be  said  to  make  for  the  avoidance  of  strikes  and 
the  establishment  of  industrial  peace.  The  investigation  has 
shown  several  well  authenticated  cases  of  strikes  which  have 
occurred  in  scientific  management  shops.  They  are  perhaps 
less  frequent  in  this  class  of  shop  than  elsewhere  in  similar 
establishments  owing  largely  to  the  fact  that  organized  work- 
men are  on  the  whole  little  employed.  In  its  extension,  how- 
ever, it  is  certain  that  scientific  management  is  a  constant 
menace  to  industrial  peace.  So  long  as  present-day  unionism 
exists  and  unionists  continue  to  believe,  as  they  seem  war- 
ranted in  doing,  that  scientific  management  means  the  destruc- 


233 

tion  of  their  organizations  or  their  present  rules  and  regula- 
tions, unionism  will  continue  to  oppose  it  energetically  and 
whenever  and  wherever  opportunity  affords. 

It  has  been  said  with  much  truth  that  scientific  management 
is  like  the  invention  of  machinery  in  its  effect  upon  workers 
and  social  conditions  and  welfare  generally — that  it  gives  a 
new  impulse  to  the  industrial  revolution  which  characterized 
the  latter  part  of  the  eighteenth  and  nineteenth  centuries  and 
strengthens  its  general  effects  and  tendencies.  A  chief  char- 
acterization of  this  revolution  has  been  the  breakdown  of 
craftsmanship,  the  destruction  of  crafts,  and  the  carrying  of 
the  modern  industrial  world  toward  an  era  of  specialized  work- 
manship and  generally  semiskilled  or  unskilled  workmen. 
Scientific  management  seems  to  be  another  force  urging  us 
forward  toward  this  era. 

CONCLUSIONS. 

7.  Our  industries  should  adopt  all  methods  which  replace 
inaccuracy  with  accurate  knowledge  and  which  systematically 
operate  to  eliminate  economic  waste.  Scientific  management 
at  its  best  has  succeeded  in  creating  an  organic  whole  of  the 
several  departments  of  an  institution,  establishing  a  coordina- 
tion of  their  functions  which  has  previously  been  impossible, 
and,  in  this  respect,  it  has  conferred  great  benefits  on  industry. 

The  social  problem  created  by  scientific  management,  how- 
ever, does  not  lie  in  this  field.  As  regards  its  social  conse- 
quences neither  organized  nor  unorganized  labor  finds  in  scien- 
tific management  any  adequate  protection  to  its  standards  of 
living,  any  progressive  means  for  industrial  education,  any 
opportunity  for  industrial  democracy  by  which  labor  may  cre- 
ate for  itself  a  progressively  efficient  share  in  management. 
Therefore,  as  unorganized  labor  is  totally  unequipped  to  work 
for  these  human  rights,  it  becomes  doubly  the  duty  of  organ- 
ized labor  to  work  unceasingly  and  unswervingly  for  them, 
and,  if  necessary,  to  combat  an  industrial  development  which 
not  only  does  not  contain  conditions  favorable  to  their  growth, 
but,  in  many  respects,  is  hostile  soil. 


234 


XIX.     Prison  Labor. 

The  evidence  which  has  come  before  the  Commission  is  the 
basis  for  the  following  statements : 

1.  The  practice  of  using  convicts  in  penitentiaries  and  pris- 

ons generally  for  the  manufacture  of  articles  for  general 
commerce  has  been  productive  of  evil  results  as  regards 
not  only  the  convicts  but  the  general  public. 

2.  The  competition  of  prison-made  articles  has  resulted  in 
the  existence  of  a  low  wage  scale  in  many  industries  and 
has  subjected  the  manufacturers  to  a  kind  of  competition 
which  should  not  exist  in  any  civilized  community. 

3.  The  only  beneficiaries  of  the  convict  labor  system  are  the 
contractors  who  are  permitted  by  the  State  to  exploit 
the  inmates  of  prisons. 

4.  The  individual  States  are  powerless  to  deal  adequately 
with  this  situation  because  of  the  interstate  shipment  of 
convict-made  goods. 

It  is  suggested  that  the  Commission  recommend: 

1.  The  abolition  as  far  as  possible  of  indoor  manufacture, 
and  the  substitution  of  such  outdoor  work  as  that  upon 
State  farms  and  State  roads,  providing  that  where  pris- 
oners are  employed  they  should  be  compensated  and  that 
the  products  which  they  manufacture  should  not  be  sold 
in  competition  with  the  products  of  free  labor. 

2.  The  enactment  by  Congress  of  a  bill  providing  that  all 
convict-made  goods  when  transported  into  any  State  or 
Territory  of  the  United  States  shall  be  subject  to  the 
operation  of  the  laws  of  such  State  or  Territory  to  the 
same  extent  and  in  the  same  manner  as  though  such  goods 
had  been  produced  therein. 


235 


XX.     Immigration. 

The  evidence  presented  to  the  Commission  is  the  basis  for 
the  following  statements: 

1.  The  immigration  policy  of  the  United  States  has  created 

a  number  of  our  most  difficult  and  serious  industrial  prob- 
lems and  has  been  responsible  in  a  considerable  measure 
for  the  existing  state  of  industrial  unrest. 

2.  The  enormous  influx  of  immigrants  during  the  past  twenty- 
five  years  has  already  undermined  the  American  stand- 
ard of  living  for  all  workmen  except  those  in  the  skilled 
trades,  and  has  been  the  largest  single  factor  in  prevent- 
ing the  wage  scale  from  rising  as  rapidly  as  food  prices. 

3.  The  great  mass  of  non-English-speaking  workers,  who 
form  about  one-half  of  the  labor  force  in  the  basic  in- 
dustries, has  done  much  to  prevent  the  development  of 
better  relations  between  employers  and  employees. 

4.  The  presence  of  such  a  large  proportion  of  immigrants 
has  greatly  hampered  the  formation  of  trade  unions  and 
has  tremendously  increased  the  problem  of  securing  ef- 
fective and  responsible  organizations. 

5.  The  unreasonable  prejudice  of  almost  every  class  of  Amer- 
icans toward  the  immigrants,  who  form  such  a  large  pro- 
portion of  the  labor  force  of  our  industries,  has  been 
largely  responsible  for  the  failure  of  our  Nation  to  reach 
a  correct  understanding  of  the  labor  problem  and  has 
promoted  the  harshness  and  brutality  which  has  so  often 
been  manifested  in  connection  with  industrial  disturb- 
ances. It  has  been  and  to  a  large  measure  still  is  felt 
possible  to  dismiss  the  most  revolting  working  condi- 
tions, the  most  brutal  treatment,  or  the  most  criminal 
invasions  of  personal  rights,  by  saying,  "Oh,  well,  they 
are  just  ignorant  foreigners." 


236 

6.  If  immigration  had  continued  at  the  average  rate  of  the 
past  ten  years  it  would  have  proved  almost,  if  not  quite, 
impossible  to  have  brought  industrial  conditions  and  re- 
lations to  any  proper  basis,  in  spite  of  the  most  extreme 
efforts  of  civic  organizations,  trade  unions,  and  Govern- 
mental machinery.  The  great  diminution  of  immigra- 
tion as  a  result  of  the  European  war,  has  already  begun 
to  show  its  salutary  effects. 

It  is  suggested  that  the  Commission  recommend : 

1.  The  enactment  of  legislation  providing  for  the  restric- 
tion of  immigration  based  upon  the  general  provisions 
contained  in  the  so-called  Burnett-Dillingham  bill,  which 
has  received  the  approval  of  two  successive  Congresses. 
With  a  full  realization  of  the  many  theoretical  objections 
which  have  been  urged  against  the  literacy  test,  the  con- 
sensus of  evidence  is  so  strong  that  its  practical  work- 
ings would  be  to  restrict  immigration  to  those  who  are 
likely  to  make  the  most  desirable  citizens,  to  regulate  im- 
migration in  some  degree  in  proportion  to  the  actual  needs 
of  American  industry,  and  finally  to  promote  education 
in  Europe,  that  it  seems  necessary  at  least  to  urge  that 
this  plan  be  given  a  practical  test. 

2.  The  enactment  of  legislation  providing  that  within  six 
months  from  the  time  of  entry  all  immigrants  shall  be 
required,  under  penalty  of  deportation,  either  to  declare 
their  intention  to  become  citizens  by  taking  out  their  first 
papers  or  to  definitely  register  themselves  with  the  proper 
authority  as  alien  tourists,  and  further  providing  that  all 
immigrants  who  have  failed  to  take  out  their  first  papers 
at  the  end  of  two  years  shall  be  deported,  as  shall  all  who 
fail  to  take  out  their  second  papers  when  they  become  eli- 
gible, deportation  in  each  case  to  act  as  a  bar  to  future 
entry. 

3.  The  provision  by  the  States  and  municipalities,  with  the 
assistance  of  the  Federal  Government,  if  necessary,  for 


237 

the  education  of  all  adult  persons  who  are  unable  to 
speak,  read  or  write  the  English  language.  In  order  to 
accomplish  this  it  may  be  necessary  to  provide  that  em- 
ployers shall  grant  certain  definite  periods  of  leisure  for 
such  instruction. 


238 


XXI.     Labor  Conditions  in  American  Colonial  Posses- 
sions. 

The  attention  of  the  Commission  was  directed  to  the  labor 
conditions  in  American  colonies  by  the  strike  of  some  20,000 
agricultural  laborers  in  the  Island  of  Porto  Rico,  and  by  the 
appeal  of  the  representatives  of  the  Free  Federation  of  Labor 
of  Porto  Rico  for  a  hearing  at  which  they  might  present  their 
statement  of  the  labor  conditions,  relations  between  laborers 
and  employers,  and  the  attitude  assumed  by  the  local  Gov- 
ernment during  the  strike.  The  Commission  granted  the  hear- 
ing and,  in  order  that  a  full  and  fair  presentation  of  the 
conditions  should  be  made,  invited  the  Government  of  Porto 
Rico  to  appoint  representatives  who  were  fully  acquainted 
with  the  situation.  As  a  result  of  the  hearing  of  the  testi- 
mony of  these  witnesses  a  situation  was  found  which  de- 
mands immediate  attention  in  order  that  widespread  and  deep- 
rooted  evils  should  be  eliminated.  These  conditions  are  in 
large  measure  an  inheritance  from  centuries  of  despotic  Span- 
ish rule,  and  it  is  undeniable  that  great  improvements  in 
certain  lines  have  been  accomplished  under  American  ad- 
ministration. Nevertheless,  a  peculiar  responsibility  rests 
upon  the  American  Nation  for  the  conditions  of  the  people 
in  our  colonial  possessions  who  occupy  the  position  morally 
and  legally  of  wards  of  the  Nation. 

The  investigations  were  confined  to  the  conditions  in  Porto 
Rico,  but  through  the  petitions  filed  with  the  Commission  by 
the  inhabitants  of  other  islands  and  through  the  informa- 
tion contained  in  reports  of  Governmental  officials,  it  seems 
certain  that  the  labor  conditions  in  all  American  colonies  are 
generally  similar  to  those  in  Porto  Rico  and  demand  the  at- 
tention of  Congress. 

As  a  result  of  the  investigations  and  a  careful  analysis  of 
the  extensive  documentary  evidence  filed,  the  following  state- 
ments with  regard  to  industrial  and  social  conditions  in 
Porto  Rico  are  warranted: 


239 

1.  Laborers  in  Porto  Rico,  including  men,  women  and  chil- 
dren, are  employed  at  wages  which  are  inadequate  to  fur- 
nish proper  food  and  clothing.  The  wages  of  men  in 
agricultural  districts  range  from  35  to  60  cents  a  day, 
when  employed,  and  those  of  the  women  and  children 
are  about  one-half  this  amount. 

2.  As  a  result  largely  of  the  low  wage  standard,  the  diet  of 
the  laborers,  consisting  chiefly  of  rice,  beans,  codfish  and 
plantains,  is  so  miserably  inadequate  that  the  worker 
not  only  is  rendered  inefficient  but  is  to  a  large  extent 
undernourished. 

3.  The  laborers  are  further  exploited  on  the  large  planta- 
tions, according  to  the  testimony  of  the  Government  rep- 
resentatives, by  exorbitant  prices  for  food  and  other  sup- 
plies, by  deliberate  cheating  as  regards  weights  and  meas- 
ures, and  by  unwarranted  deductions  from  their  wages 
for  goods  that  were  never  purchased. 

4.  The  educational  facilities  of  Porto  Rico  are  so  totally 
inadequate  that  there  are  nearly  200,000  children  for 
whose  education  no  provision  has  been  made. 

The  representatives  of  the  colonial  Government  give  a 
lack  of  ability  to  finance  the  educational  system  as  the 
reason  for  the  present  conditions. 

5.  Many  thousand  people  yearly,  located  in  the  rural  dis- 
tricts, far  from  medical  attendance  and  unable  to  afford 
the  high  charges  of  the  physicians,  die  without  medical 
attendance. 

6.  The  labor  laws  of  Porto  Rico  are  inadequate  and  the 
Bureau  of  Labor  is  not  provided  with  sufficient  funds  to 
enforce  the  existing  laws.  The  laws  supposed  to  regu- 
late the  labor  of  women  and  children  are  generally  vio- 
lated. The  provisions  of  the  law  restraining  child  labor 
are  largely  nullified  by  the  insertion  of  a  clause  which 


240 

permits  this  labor  if  the  child  is  accompanied  by  a  parent 
or  other  relative. 

The  employers'  liability  law  of  the  island  has  the 
archaic  fellow-servant  clause  in  it  and  therefore  is  non- 
effective. 

7.  The  great  majority  of  the  Porto  Bicans  are  landless, 
the  land  of  Porto  Rico  being  largely  owned  by  the  cor- 
porations, wealthy  landlords,  and  the  colonial  Government 
and  municipalities.    Very  little  land  is  for  sale. 

8.  As  a  result,  the  land  rents  are  inordinately  high  and  tend 
very  strongly  to  retard  the  development  of  a  middle 
class. 

9.  The  housing  conditions  of  the  workers  are  extremely 
bad.  The  majority  of  the  rural  workers  live  in  huts 
which  do  not  cost  more  than  $10  to  build,  and  these  huts 
are  occupied,  on  an  average,  by  five  people  each,  although 
at  best  there  are  only  semipartitions  dividing  the  huts 
into  two  rooms.  The  existing  conditions  are  a  menace 
not  only  to  health,  but  to  morality  and  every  sense  of 
decency. 

10.  The  laborers  may  be  ejected  from  the  huts  provided  by 
the  employers  at  any  time  that  the  owner  sees  fit,  and, 
while  they  pay  no  rent,  they  must  and  do  work  for  the 
owner  at  his  pleasure. 

11.  In  the  cities  the  conditions  are  almost  equally  bad.  The 
city  laborers  rent  apartments  or  build  little  houses  on 
rented  land.  As  an  illustration  of  this  condition :  There 
were,  in  1912,  10,936  people  in  Puerto  de  Tierra.  These 
people  lived  in  1144  houses  and  practically  98  per  cent 
of  them  were  renters,  as  the  occupants  of  only  30  houses 
owned  both  house  and  land.  The  land  of  one  owner,  which 
was  assessed  at  $6,340,  brought  in  a  total  rent  of  $2,580, 
or  37.4  per  cent.  That  of  another,  assessed  at  $29,460, 
yielded  $7,821  in  rent,  or  23.9  per  cent. 


241 

12.  Unemployment  is  very  prevalent  in  the  island,  and  it  has 
been  testified  that,  largely  as  the  result  of  stimulated 
immigration,  there  are  between  200,000  and  300,000  more 
workers  than  jobs. 

13.  The  immigrants  from  the  English-speaking  islands  or 
from  the  main  land  are  given  preference  over  the  native 
Porto  Ricans,  who  speak  Spanish.  This  has  resulted  in 
much  hardship  to  the  natives. 

14.  The  strike  of  agricultural  laborers  and  other  workers 
which  began  in  January,  1915,  was  not  only  justified  but 
was  in  the  interests  of  the  progress  of  the  island.  The 
long  hours,  low  wages,  and  exploitation  of  the  laborers 
could  not  have  been  relieved  except  by  their  organized 
action.  This  is  in  accord  with  the  testimony  of  the  Gov- 
ernment representatives. 

15.  These  laborers,  hitherto  unorganized,  excitable,  and  filled 
with  a  sense  of  the  grievous  wrongs  which  they  and  their 
families  had  suffered,  were  poorly  disciplined  and  may 
have  been  guilty  of  excesses  of  speech  and  action,  al- 
though there  is  much  evidence  to  indicate  that  they  were 
peaceful  and  law-abiding  until  provoked  by  the  agents 
of  the  employers  or  by  the  police. 

16.  Whatever  may  have  been  the  actions  of  the  strikers,  how- 
ever, there  can  be  no  excuse  for  the  actions  of  the  police 
and  municipal  authorities,  who  violated  the  personal 
rights  of  the  strikers,  treated  them  in  many  cases  with 
wanton  brutality,  resulting  in  the  death  of  large  numbers, 
held  them  in  excessive  bail,  denied  them  access  to  the 
ordinary  processes  of  the  courts,  and  inflicted  excessive 
and  unwarranted  punishments  upon  them. 

17.  The  blame  for  such  conditions  appears  to  rest  primarily 
upon  the  rural  police  and  local  magistrates. 


242 

18.  The  demands  for  legislation  made  by  the  representatives 
of  the  Free  Federation  of  Labor  of  Porto  Rico  appear 
to  be  wise  and  reasonable,  but  without  an  opportunity 
for  full  local  investigation  it  is  impossible  to  fully  en- 
dorse them. 

It  is  suggested  that  the  Commission  recommend  provision 
by  Congress  for  early  and  thorough  investigation  of  the  in- 
dustrial and  social  conditions  in  Porto  Rico  and  all  other 
American  colonies. 


243 


XXII.     Chinese  Exclusion. 


The  investigations  with  reference  to  that  section  of  the 
Act  which  directed  the  Commission  to  inquire  ''into  the  ques- 
tion of  smuggling  or  other  illegal  entry  of  Asiatics  into  the 
United  States  or  its  insular  possessions"  were  made  largely 
under  the  direction  of  Mr.  E.  A.  Fitzpatrick  and  Mr.  E.  H. 
Busiek.  The  extensive  evidence  collected  regarding  this  en- 
tire question  is  contained  in  the  report  of  Mr.  Fitzpatrick 
which  is  submitted  herewith. 

The  constructive  suggestions  and  recommendations  which 
have  been  approved  by  the  special  subcommittee  on  Chinese 
Exclusion,  consisting  of  Chairman  Frank  P.  Walsh  and  Com- 
missioners Harris  Weinstock  and  James  O'Connell,  and  ac- 
cepted by  the  entire  Commission,  with  reservations  as  to  the 
agency  of  administration,  are  as  follows : 


CONSTRUCTIVE  SUGGESTIONS. 


Changes  in  the  Law. 

The  following  changes  should  be  made  in  the  law  in  the 
interest  of  administrative  efficiency: 

1.  That  the  many  laws  relating  to  the  exclusion  of  Chinese 
be  codified  into  a  comprehensive  statute. 

2.  That  Chinese  alleged  to  have  entered  the  United  States 
surreptitiously  shall  be  tried  by  administrative  process, 
i.  e.,  on  Secretary  of  Labor's  warrant — in  all  cases  ir- 
respective of  time  of  entry  or  defense  of  citizenship.1 


1 — The  Anomalous  Citizenship  Situation.  A  Chinese  person  can  not  become 
a  citizen  by  naturalization.  The  child  of  a  Chinese  alien  man  and 
woman,  who  themselves  could  never  become  citizens,  would  be,  if  born 
in  the  United  States,  an  American  citizen.  The  fact  that  the  parents 
never  intend  that  the  child  should  be  an  American  citizen,  and  the  child 


244 

At  the  present  time  only  Chinese  alleged  to  have  entered 
within  three  years  may  be  tried  on  Secretary's  warrant. 

3.  That  immigration  officers  be  specifically  given  the  power 
of  arrest  or  taking  into  custody. 

4.  That  immigration  officers  be  given  the  right  to  administer 
binding  oaths  in  all  cases  arising  under  the  immigration 
law. 

5.  That  immigration  officials  be  given  the  power  to  compel 
attendance  of  witnesses  and  the  production  of  documen- 
tary or  other  evidence  in  all  cases  providing  for  punish- 
ment for  contempt. 

6.  That  the  attacking  of  an  immigration  official  or  interfer- 
ence with  him  in  the  performance  of  his  duties,  or  any 
maltreatment  of  him  growing  out  of  the  performance  of 
his  duties,  should  be  made  a  penal  offense. 

itself  even  when  grown  up  never  regards  himself  as  an  American  citizen 
except  for  purposes  of  the  Chinese  exclusion  law,  does  not  enter  into  the 
matter.  The  child  of  an  American  citizen  born  on  foreign  soil — China 
or  elsewhere — is  an  American  citizen. 

Chinese  arrested  for  being  unlawfully  in  the  United  States  set  up 
the  claim  of  nativity.  This  claim  is  in  many  cases  fraudulent.  The 
matter  is  easy.  A  Chinaman,  when  arrested,  is  told  to  stand  mute,  or, 
if  the  story  has  been  concocted,  he  tells  a  story  like  this:  I  was  born 
in  San  Francisco,  or  in  some  rural  place,  where  there  are  no  records  of 
birth.  My  father  and  mother  returned  to  China  when  I  was  four  years 
old.  I  remained  with  my  clansman,  Mr.  Y-M-G,  who  has  since  returned 
to  China  or  died.  For  the  past  four  years  I  have  remained  with  my 
uncle,  who  was  at  the  baptismal — shaving — feast,  and  can  testify  to  these 
facts.  Uncle  testifies.  United  States  Commissioner  discharges  the  China- 
man, and  if  nativity  was  the  defense  the  citizenship  of  the  Chinaman  is 
res  judicata.    Thus  are  citizens  made. 

A  rather  dangerous  situation  is  developing  in  this  connection.  In 
one  large  city  of  the  country  definite  efforts  are  being  made  to  vote  the 
Chinaman  and  have  his  citizenship  established  that  way.  This  of  nec- 
essity brings  the  question  into  local  politics  and  complicates  further  an 
already  awkward  situation.  This  situation  ought  to  be  cleared  up.  The 
fundamental  change  required  is  an  amendment  to  the  Constitution. 


245 

7.  That  the  place  of  deportation  to  which  contraband  China- 
men shall  be  sent  may  be,  in  the  discretion  of  the  Secre- 
tary of  Labor,  the  country  whence  he  came,  or  the  country 
of  his  citizenship,  or  the  trans- Atlantic  or  trans-Pacific 
port  from  which  he  embarked  for  this  Continent. 

8.  That  there  be  a  clearer  and  more  definite  legislative  defini- 
tion of  the  exempt  and  of  the  admitted  classes. 

9.  That  there  be  a  clearer  definition  of  legislative  policy 
as  to  the  status  under  the  immigration  and  Chinese  ex- 
clusion law  of  Chinamen  admitted  as  exempts  and  sub- 
sequently assuming  a  non-exempt  status. 

10.  That  the  pecuniary  and  family  conditions  for  the  return 
of  Chinese  laborers  in  the  United  States  to  China  be 
repealed. 

11.  That  the  recommendation  of  a  new  registration  because  it 
is  needed  to  enforce  the  present  law  be  rejected.  This 
must  not  be  understood  to  mean  a  rejection  of  a  new 
registration  law  as  a  part  of  legislative  policy,  but  solely 
when  it  is  urged  for  administrative  reasons. 

12.  That  masters  of  vessels  be  responsible  for  every  Chinese 
member  of  their  crew  who  was  on  board  the  vessel  when 
it  enters  and  is  not  on  board  when  it  is  ready  for  clear- 
ance. 


United  States  Commissioners. 

1.  That  the  jurisdiction  of  United  States  Commissioners  in 
Chinese  exclusion  cases  be  abolished,  or,  what  is  less  de- 
sirable1— 


-All  interests  would  be  best  served  by  an  administrative  rather  than  a 
judicial  procedure  in  cases  of  contraband  Chinese.  As  usual,  writs  of 
habeas  corpus  would  be  issued  by  the  courts  in  case  of  arbitrary  action 
or  of  jurisdiction  in  these  cases. 


246 

2.  That  the  following  changes  in  the  system  be  made :  United 
States  Commissioners  should  receive  adequate  compensa- 
tion for  the  service  rendered.  United  States  Commis- 
sioners should  be  made  courts  of  record  and  stenographic 
and  other  expenses  provided  for.  The  Government  should 
be  given  right  of  appeal  in  Chinese  cases. 

The  Judicial  System. 

1.  That  the  handling  of  cases  of  contraband  Chinamen 
should  be  handled  by  administrative  rather  than  by  ju- 
dicial procedure. 

2.  That  the  present  administrative  procedure  be  continued 
practically  without  modification,  except  for  the  improved 
handling  of  appeals  as  recommended  elsewhere  in  these 
suggestions. 

3.  That  writs  of  habeas  corpus  should  be  issued  only  on  the 
basis  of  a  prima  facie  case. 

4.  That  in  criminal  cases  (smuggling)  full  sentences  should 
be  imposed  instead  of  light  sentences  as  at  present. 

5.  That,  if  advisable,  the  cases  of  contraband  Chinamen 
might  be  held  under  the  board  of  special  inquiry  pro- 
cedure provided  for  in  cases  of  immigrants  not  passed 
upon  primary  inspection  for  admission.  The  adoption  of 
this  suggestion  would  necessitate  the  employment  of  a 
considerable  number  of  additional  men — and  for  this  rea- 
son ought  not  to  be  adopted  immediately. 

General,  Administration. 

1.  Definitely  withdraw  the  order  of  1905. 

2.  By  conference  with  Treasury  Department  provide  for 
more  careful  sealing  and  supervision  of  sealed  freight 
cars  crossing  the  border — 


247 

a.  By  placing  seal  number  and  place  of  each  car  on 
the  manifest. 

b.  By  taking  number  and  place  of  each  seal  of  each  car 
independently— and  testing  seal. 

c.  By  comparing  local  record  with  manifest  immedi- 
ately. 

d.  By  examination  of  contents  of  each  car  where  there 
is  the  least  discrepancy  or  suspicion. 

The  Selection  of  Inspectors. 

1.  That  the  position  of  Chinese  inspector  be  revived. 

2.  That  the  selection  of  Chinese  inspectors  by  Civil  Service 
examination  for  general  immigrant  inspectors  be  con- 
tinued. 

3.  That  the  present  examination  be  changed  in  scope  as  fol- 
lows: 

a.  That  all  papers  now  required  be  omitted  except 
" practical  questions." 

b.  That  greater  credit — larger  proportion  of  examina- 
tion— be  given  for  practical  experience  in  handling 
the  public. 

c.  That  new  examination  in  report- writing  be  given  to 
include  a  practical  test  in  condensation — material  to 
relate  to  immigration,  formulation  of  a  report  on  a 
given  statement  of  fact,  letter  writing. 

d.  That  the  examination  include  a  test  on  Canadian 
immigration  laws. 

e.  That  it  include  a  test  of  knowledge  of  our  National 
Government,  particularly  of  those  departments  that 
are  related  to  the  work  of  immigration — 

Treasury  Department. 

Congress. 

The  Judicial  System. 

Department  of  State. 


248 

/.    That,  if  possible,  an  oral  examination  be  included. 

g.  That  the  examination  include  somewhere  questions 
on  the  relation  of  immigration  and  emigration  to  a 
National  policy,  on  immigration  as  an  internal  policy, 
and  a  general  history  of  immigration. 

4.  That  the  examination  have  specific  reference  in  its  ques- 
tions to  immigration  work  and  not  be  mere  general 
tests. 

5.  That  Chinese  inspectors  be  selected  from  the  more  ex- 
perienced immigrant  inspectors  who  show  an  inclination 
and  ability  in  the  special  requirements  of  this  end  of 
the  service. 

6.  That  the  probationary  period  of  an  immigrant  inspector 
be  one  year. 


Chinese  Interpreters. 

1.  That  in  the  selection  of  interpreters  the  present  examina- 
tion be  continued  except  that  in  testing  ability  to  translate 
or  interpret  actual  cases  be  taken  in  course  of  routine 
work  rather  than  the  present  moot  examination. 

2.  That  in  securing  candidates  for  positions  as  interpreters 
the  immigration  service  should  look  to  the  large  number 
of  Chinese  students  in  our  universities,  particularly  those 
who  are  here  at  the  expense  of  the  United  States  Gov- 
ernment (the  Boxer  indemnity  money). 

3.  That  the  position  of  Chinese  interpreter  be  graded  into 
two  grades  at  least,  as  follows : 

a.  Those  who  can  interpret  the  spoken  Chinese  of  one 
or  more  dialects. 

b.  Those  who  can  in  addition  read  the  written  language. 


249 

4.  That  the  salary  program  outlined  for  inspectors  be 
adapted  to  the  interpreters. 

5.  That  a  conference  be  arranged  by  the  various  depart- 
ments of  Government  who  use  interpreters  of  Chinese  to 
work  out  some  plan  of  securing  honest,  capable  inter- 
preters— perhaps  in  cooperation  with  the  universities. 

A  Staff  Organization  at  Washington. 

1.  That  there  be  established  at  Washington  a  staff  organiza- 
tion including  at  least — 

a.  Another  Assistant  Secretary  of  Labor  to  handle 
Chinese  appeal  cases,  etc. 

b.  A  central  law  organization  providing  for  the  con- 
tinuous study  of  the  legal  aspects  of  immigration. 

c.  A  central  Chinese  smuggling  bureau  reinforcing  dis- 
trict administration  in  its  attempt  to  deal  with 
smuggling  gangs  and  other  organized  smuggling. 

d.  A  central  agency  of  training  and  inspection,  pro- 
viding for  the  continuous  supervision  and  training  of 
the  men  in  the  service. 

e.  A  central  clearing  house  of  information  and  records. 

2.  That  it  be  specifically  made  a  function  of  the  division  of 
supervision  and  training  to  keep  district  officers  informed 
as  to — 

a.  Significant  court  decisions  in  all  districts. 

b.  Significant  discoveries  of  district  offices,  e.  g.,  the 
Japanese  (Korean)  passport  case. 

c.  Effective  methods  of  handling  particular  situations, 
e.  g.,  of  commissioner  who  refuses  to  give  full  cred- 
ence to  preliminary  hearings  before  immigrant  in- 
spectors by  bringing  contraband  Chinamen  immedi- 
ately before  commissioner. 

d.  Chinese  refused  papers  in  any  place. 


250 

3.  That  this  organization  should  keep  field  officers  informed 
as  to  forward  steps  and  other  significant  developments. 

Salary  Plan. 

1.  That  the  service  be  regarded  for  salary  purposes  as  a  unit 
rather  than  as  twenty-three  individual  units. 

2.  That  the  administrative  officers  work  out  a  detailed  plan 
of  graded  salary  increases. 

3.  That  there  be  an  annual  increase  in  salary  of  a  definite 
amount  for  a  definite  number  of  years  of  service  upon 
certification  of  meritorious  service  during  the  preceding 
year.  On  the  basis  of  an  initial  salary  of  $1380,  it  seems 
to  us  there  ought  to  be  an  annual  increase  of  at  least 
thirty-six  dollars  per  year  for  fifteen  years,  making  a 
maximum  salary  of  $1920.  The  specific  amounts  named 
are  offered  as  suggestions. 

4.  That  positions  in  the  service  ought  to  be  graded  and  cor- 
respondingly higher  initial  salaries  provided  for  the 
higher  grades.  The  system  of  annual  increases  perhaps 
of  the  same  amount,  ought  to  be  provided  here.  A  larger 
increase  for  a  less  number  of  years  might  be  advisable. 
It  should  be  provided  in  this  connection  that  a  man  pro- 
moted from  a  lower  to  a  higher  position,  if  he  is  receiving 
a  higher  salary  than  the  initial  salary  of  the  higher  posi- 
tion, should  receive  the  next  higher  salary  to  the  salary 
he  is  receiving  in  the  lower  position.  A  person  standing 
in  a  little  house  watching  those  who  come  across  an  in- 
ternational bridge  in  Suspension  Falls,  another  doing  pri- 
mary inspection  work  or  board  of  inquiry  work  at  Ellis 
Island,  another  working  " under  cover"  among  the  thugs 
of  Buffalo  and  being  beaten  into  insensibility,  another 
doing  train  inspection  work — would  receive  no  pay  be- 
cause of  difference  of  duties.  It  is  submitted  that  some 
recognition  of  this  difference  in  duties  ought  to  find  ex- 
pression in  the  salary  schedule. 


251 

5.  Superior  service  should  be  rewarded  both  by  formal  com- 
mendation and  by  salary  increases.  Two  provisions  might 
be  included : 

a.  The  reward  for  a  single  brilliant  piece  of  work, 
such  as  working  under  cover  with  smugglers,  risk- 
ing one's  life,  and  landing  the  gang  in  jail. 

b.  The  provision  of  a  higher  annual  increase  for  men 
giving  continuous  superior  service. 


Eedisteicting. 

That  there  be  a  redisricting  of  the  United  States  for  im- 
migration purposes  with  more  regard  to  geographical 
facts  and  to  the  efficiency  of  the  service. 

That  district  offices  take  a  periodic  census  in  cooperation 
with  the  State  or  National  Census  or  both,  or,  if  neces- 
sary, independent  of  each.  (This  would  help  local  offices 
to  really  see  their  problems.  It  would  acquaint  them  with 
their  constituency.) 

That  this  census  be  kept  up  to  date  and  supplemented  by 
cooperation  with  municipal  and  State  boards  of  health 
and  bureaus  of  vital  statistics  by  recording  currently — 

a.  Chinese  births. 

b.  Chinese  deaths. 

c.  Chinese  marriages. 

That  this  census  be  kept  up  to  date  and  supplemented  by 
making  part  of  the  record  all  the  examinations  of  Chinese 
in  connection  with  routine  and  other  investigations.  A 
system  of  cross  reference  cards  should  be  on  file  in  Wash- 
ington. It  should  be  kept  up  to  date  and  supplemented 
by  listing  removals  and  advising  as  far  as  possible  the 
district  to  which  the  Chinaman  moved. 


252 

5.  That  the  force  should  be  increased  and  the  whole  group 
of  inspectors  be  organized  for  regular  field  work.  This 
should  take  the  place  of  any  system  of  national  arrest 
crews. 

6.  That  the  system  of  rewards  of  conductors,  trainmen  and 
policemen  who  supply  information  leading  to  arrests  of 
contraband  Chinese  or  smugglers,  which  seems  now  in 
abeyance,  be  revived  and  be  provided  for  in  an  emergency 
fund  for  each  district.  (Approval  of  Washington  per- 
haps should  be  required  in  each  case.) 

7.  That  a  business  and  occupation  census  of  each  district  ac- 
company the  census  of  persons. 

8.  That  the  force  of  immigrant  inspectors  assigned  to  Chi- 
nese work  be  increased. 

9.  That  the  equipment  to  be  used  in  the  work  of  administer- 
ing the  Chinese  exclusion  law  be  adequate  to  cope  with 
the  smugglers. 

Frank  P.  Walsh.1 
John  B.  Lennon.1 
James  O'Connell.1 
Austin  B.  Garretson.1 


1 — See  supplemental  statement. 


253 


ADDITIONAL   FINDINGS    OF  FACT,   CONCLUSIONS 
AND  RECOMMENDATIONS. 

At  regular  sessions  of  the  Commission  with  all  members 
present,  the  following  resolutions  were  offered  for  adoption 
as  a  part  of  the  Commission's  report  to  Congress.  The  mem- 
bers of  the  Commission  whose  names  appear  in  connection 
with  the  various  resolutions,  voted  for  their  adoption  and 
thereby  made  the  resolutions  a  part  of  their  individual  re- 
ports to  Congress. 


ADOPTED  BY  UNANIMOUS  VOTE. 

Whereas,  The  Commission  finds  that  the  terms  open  shop 
and  closed  shop  have  each  a  double  meaning,  and  should 
never  be  used  without  telling  which  meaning  is  intended,  the 
double  meaning  consisting  in  that  they  may  mean  either  union 
or  nonunion ;  Therefore,  for  the  purposes  of  this  report, 

Be  It  Resolved,  That  the  Commission  on  Industrial  Rela- 
tions will  not  use  the  terms  ''open  shop"  and  "closed  shop," 
but  in  lieu  thereof  will  use  "union  shop"  and  "nonunion 
shop." 

The  union  shop  is  a  shop  where  the  wages,  the  hours  of 
labor,  and  the  general  conditions  of  employment  are  fixed  by 
a  joint  agreement  between  the  employer  and  the  trade  union. 

The  nonunion  shop  is  one  where  no  joint  agreement  exists, 
and  where  the  wages,  the  hours  of  labor,  and  the  general 
conditions  of  employment  are  fixed  by  the  employer  without 
cooperation  with  any  trade  union. 

Wherever  the  terms  are  used  in  this  report,  they  bear  the 
interpretation  as  set  forth  above. 


254 


ADOPTED  BY  MAJORITY  VOTE  OF  COMMISSIONERS 
WALSH,  LENNON,  O'CONNELL,  GARRET- 
SON  AND  WEINSTOCK. 

The  sources  from  which  industrial  unrest  springs  are,  when 
stated  in  full  detail,  almost  numberless.  But,  upon  careful 
analysis  of  their  real  character,  they  will  be  found  to  group 
themselves  almost  without  exception  under  four  main  sources 
which  include  all  the  others.    These  four  are : 

1.  Unjust  distribution  of  wealth  and  income. 

2.  Unemployment  and  denial  of  an  opportunity  to  earn  a 
living. 

3.  Denial  of  justice  in  the  creation,  in  the  adjudication,  and 
in  the  administration  of  law. 

4.  Denial  of  the  right  and  opportunity  to  form  effective  or- 
ganizations. 


We  recommend  that  private  ownership  of  public  utilities  be 
abolished  and  that  the  States  and  municipalities  take  over 
the  same  under  just  terms  and  conditions,  so  that  they  may 
be  operated  by  the  States  or  municipalities. 

RECEIVED  APPROVAL  OF  COMMISSIONERS  WALSH, 
LENNON,  O'CONNELL  AND  GARRETSON. 

We  find  that  the  limitation  of  the  right  of  suffrage  to  men 
has  been  a  most  serious  handicap  to  women  in  industry  in 
their  long  and  splendid  struggle  to  secure  compensation  for 
their  labor,  humane  working  conditions,  and  protective  laws. 


We  recommend  that  private  ownership  of  coal  mines  be 
abolished ;  and  that  the  National  and  State  Governments  take 
over  the  same,  under  just  terms  and  conditions,  and  that  all 
coal  lands  shall  thereafter  be  leased  upon  such  terms  that  the 
mines  may  be  cooperatively  conducted  by  the  actual  workers 
therein. 


255 

All  religions,  the  family  life,  the  physical  well-being  of  the 
worker,  the  integrity  of  the  State,  and  the  comfort  and  happi- 
ness of  mankind,  require  that  no  human  being  shall  be  per- 
mitted to  work  more  than  six  days  in  each  week.  This  Com- 
mission refuses  to  recognize  any  claim  of  so-called  business 
expediency  or  alleged  domestic  or  public  necessity,  which 
ignores  this  elemental  and  righteous  demand.  We  therefore 
suggest  that  stringent  laws  be  passed  by  State  and  Nation 
making  it  an  offense  punishable  by  fine  and  imprisonment  to 
permit  any  person  to  work  more  than  six  days  in  each  week. 


We  find  that  practically  nothing  has  been  done  toward  the 
very  necessary  development  of  organizations  of  women  en- 
gaged in  domestic  service,  and  that  no  standards  governing 
the  toil  of  the  thousands  thus  engaged  have  been  established. 

As  a  necessary  step  in  this  direction,  we  recommend  that 
the  hours  of  such  workers  should  be  limited  to  eight  per  day; 
that  no  such  persons  be  permitted  to  work  over  six  days  in 
each  week;  that  a  minimum  wage  be  fixed  for  this  class  of 
employees  which  will  insure  them  a  comfortable  life  without 
being  required  to  live  in  the  homes  of  persons  employing 
them,  where  they  may  be  subjected  to  objectionable  or  un- 
comfortable living  conditions. 

That  all  of  the  improvements  and  safeguards  recommended 
for  adoption  in  this  report,  as  applying  to  women  in  other 
lines  of  industry,  shall  apply  with  equal  force  and  effect  to 
women  engaged  in  domestic  service. 


We  find  that  the  direct  and  proximate  cause  of  the  killing  of 
men,  women  and  children,  destruction  of  property,  and  looting 
of  the  homes  of  the  striking  miners,  in  the  Southern  Colorado 
coal  fields,  during  the  strike  therein,  was  the  arbitrary  re- 
fusal of  the  coal  mine  operators  to  meet  and  confer  with  the 
representatives  of  the  workers  in  their  several  mines.  Inas- 
much as  the  officials  of  the  Colorado  Fuel  &  Iron  Company 
admit  that  said  company  fixed  the  prices  and  conditions  of 


256 

labor  in  the  State  of  Colorado  at  the  time  in  question,  after 
fully  considering  and  weighing  all  of  the  testimony  advanced 
at  the  public  hearings,  and  especially  the  admissions  and  dec- 
larations of  the  officers  and  directors  of  the  Colorado  Fuel  & 
Iron  Company,  including  Mr.  John  D.  Rockefeller,  Jr.,  we 
find  that  the  final  and  full  responsibility  for  the  refusal  to 
confer  with  said  representatives,  and  for  all  the  deplorable 
results  which  followed  such  refusal,  must  be  placed  upon  Mr. 
John  D.  Rockefeller  and  Mr.  John  D.  Rockefeller,  Jr. 


We  wish  to  report  to  your  Honorable  Body  that  Mr.  John  D. 
Rockefeller  Jr.  and  Mr.  W.  L.  Mackenzie  King,  witnesses 
regularly  called  before  this  Commission,  refused  to  answer 
questions  relevant  and  material  to  the  inquiries  provided 
for  in  the  act  of  Congress  creating  this  Commission,  as  shown 
by  the  excerpts  from  the  official  transcript  of  the  testimony 
filed  herewith  and  attached  hereto,  and  we  therefore  recom- 
mend that  the  said  witnesses  be  summoned  by  the  House  of 
Representatives,  according  to  its  usual  procedure,  immedi- 
ately upon  its  convening,  or  as  soon  thereafter  as  may  be 
reasonably  convenient,  and  that  said  questions  again  be  pro- 
pounded to  said  persons,  and  that  they  be  compelled  to  answer 
the  same. 


Questions  Which  Mr.  W.  L.  Mackenzie  King  Refused  to 

Answer. 

Chairman  Walsh:    What  salary  do  they  pay  you? 

Mr.  King :  That  is  a  matter  you  do  not  have  a  right  to  in- 
quire into.  I  was  asked  if  I  would  undertake  this  work  for 
a  period  of  years.  I  said  I  would  not,  that  all  I  would  under- 
take to  do  was  to  take  it  for  a  year ;  that  I  wanted  to  be  per- 
fectly free  at  the  end  of  a  year  to  terminate  my  arrangement 
with  the  Rockefeller  Foundation  if  I  did  not  see  it  was  going 
to  give  the  opportunity  for  the  practical  results  I  wanted  to 
get.  I  made  an  undertaking  with  them  on  that  basis,  with  that 
understanding,  and  they  asked  me  to  take  it  for  another 


257 

period  of  time,  and  I  refused,  and  I  made  the  further  stipula- 
tion that  if  by  any  chance  an  election  should  be  brought  on  in 
Canada,  I  should  resign  before  that  time.  I  think  under  those 
circumstances  the  public  would  hardly  expect  me  to  answer 
what  particular  remuneration  I  am  receiving. 

Chairman  Walsh:  Are  you  going  to  make  your  report  to 
anybody?  Are  you  going  to  give  anybody  these  facts  that 
you  are  collecting,  the  result  of  these  interviews? 

Mr.  King:  No  sir,  I  have  not  decided  that,  but  if  you  mean 
am  I  going  to  give  them  to  anybody  connected  with  the  Foun- 
dation or  Mr.  Rockefeller,  I  would  say  no. 

Chairman  Walsh:    Are  you  going  to  give  them  to  the  Gov- 
ernment? 
Mr.  King:    No. 

Chairman  Walsh:  Are  you  going  to  give  them  to  the  or- 
ganizations of  workers? 

Mr.  King:    I  will  give  them  the  results. 

Chairman  Walsh:  But  as  far  as  the  facts  are  concerned, 
your  purpose  is  to  keep  them  absolutely  secret? 

Mr.  King:  No,  sir,  I  would  not  be  telling  the  truth  to  say 
that. 

Chairman  Walsh:    Who  are  you  going  to  tell  them  to? 

Mr.  King:    On  that  I  shall  use  my  own  judgment. 

Chairman  Walsh:  Did  you  talk  to  the  President  or  Secre- 
tary or  Treasurer  of  the  United  Mine  Workers  of  America  in 
Denver? 

Mr.  King:  I  have  said  already,  Mr.  Chairman,  that  I  de- 
sired to  have  regarded  as  confidential  the  persons  that  I  saw. 

Chairman  Walsh:  Did  you  call  upon  the  President,  the  Sec- 
retary, or  the  Treasurer  of  the  State  Federation  of  Labor  of 
Colorado? 

Mr.  King:  I  have  already  stated  that  I  intend  to  regard  as 
confidential  the  interviews  that  I  had  in  Colorado.  That  is 
my  position  in  regard  to  that.    *    *    * 


258 

Chairman  Walsh:  I  asked  if  you  saw  the  President,  the 
Secretary,  or  the  Treasurer  of  the  United  Mine  Workers  of 
America  or  the  President,  the  Secretary,  or  the  Treasurer  of 
the  State  Federation  of  Labor  of  the  State  of  Colorado? 

Mr.  King:   I  remain  just  exactly  where  I  put  myself  before. 

Chairman  Walsh:    You  refuse  to  answer  that  question? 

Mr.  King:  I  refuse  to  disclose  any  of  the  interviews  I  had 
in  Colorado ;  and  let  me  make  this  perfectly  plain,  Mr.  Chair- 
man.   I  saw  some  of  the  persons  you  have  mentioned — 

Chairman  Walsh  (interrupting) :    Name  them. 

Mr.  King:  No,  I  will  not.  I  do  not  intend  to  disclose  the 
names,  and  I  do  not  intend  to  let  the  impression  go  abroad 
that  I  avoided  seeing  anyone,  not  for  one  minute.    *    *    * 

Chairman  Walsh:  Did  you  find  it  [industrial  unrest]  very 
bitter  in  Colorado? 

Mr.  King:  I  prefer  not  to  discuss  the  Colorado  situation 
at  all. 

Chairman  Walsh:  Please  outline  for  this  Commission  the 
policies  which  you  consider  should  be  put  into  effect  in  Colo- 
rado in  the  industry  of  the  Colorado  Fuel  &  Iron  Company  ? 

Mr.  King:  No,  Mr.  Chairman.  I  have  said  I  do  not  desire 
to  discuss  the  Colorado  situation. 

Chairman  Walsh:  Do  you  consider  that  the  miners  in  Colo- 
rado were  justified  in  demanding  a  recognition  of  their  na- 
tional union? 

Mr.  King:  I  have  already  said  I  don't  care  to  discuss  the 
merits  of  that  strike  one  way  or  the  other. 

Chairman  Walsh:    Where  do  you  keep  them?  [referring  to 
notes  Mr.  King  testified  he  had  made  in  Colorado]. 
Mr.  King:    I  am  not  going  any  further  in  my  answer. 

Chairman  Walsh:  Think  again,  and  may  be  you  will  go 
further? 

Mr,  King:    No  I  won't. 


259 

Chairman  Walsh:    Are  they  in  charge  of  anyone  else,  or  in 
your  possession  J 

Mr.  King:    That  is  my  affair,  Mr.  Chairman. 

Chairman  Walsh:    Are  they  kept  in  New  York  or  Washing- 
ton, or  at  your  home? 

Mr.  King :    They  are  not  kept  either  in  New  York,  Colorado, 
or  at  my  home  at  this  moment. 

Chairman  Walsh:    In  Washington? 

Mr.  King:    I  have  nothing- further  to  say. 

Chairman  Walsh:    It  is  a  dead  secret? 

Mr.  King:    Yes,  a  dead  secret. 


Questions  Which  Mr.  John  D.  Rockefeller  Jr.  Refused  to 

Answer. 

Chairman  Walsh:  It  is  not  in  a  letter.  It  was  in  a  news- 
paper statement.  Did  you  write  your  own  newspaper  state- 
ments, or  were  they  dictated,  or  were  they  written  by  some- 
one else? 


Mr.  Rockefeller :  I  assume  the  responsibility  for  every- 
thing that  was  sent  out  in  my  name.    *    *    * 

Chairman  Walsh:  Did  Mr.  Ivy  Lee  write  the  newspaper 
interviews  purporting  to  come  from  you? 

Mr.  Rockefeller:    I  have  answered  the  question. 

Chairman  Walsh:  Do  you  assume  the  responsibility  for 
that? 

Mr.  Rockefeller:    For  everything  that  goes  out  in  my  name. 

Chairman  Walsh:  I  am  asking  for  the  fact.  Did  you  write 
it? 

Mr.  Rockefeller:  I  have  covered  the  situation,  Mr.  Chair- 
man. 

Chairman  Walsh:    You  do  not  care  to  go  any  further? 

Mr.  Rockefeller:   I  do  not.    I  do  not  think  it  necessary. 


260 

Chairman  Walsh:  Did  you  write  that  answer?  [Referring 
to  the  prepared  statement  which  Mr.  Rockefeller  read  upon 
the  stand.] 

Mr.  Rockefeller:  I  take  the  responsibility  for  that  entire 
answer. 

Chairman  Walsh:  Did  you  write  it  or  did  somebody  else 
write  it  for  you? 

Mr.  Rockefeller:    It  is  not  a  matter  that  I  think  is  material. 

Chairman  Walsh:    Did  Mr.  Lee  write  it? 

Mr.  Rockefeller:    I  have  no  further  answer  to  give. 

Question:  What  agreements  or  understanding,  verbal  or 
written,  exist  between  the  Foundation  and  Mr.  King,  regard- 
ing the  scope  of  the  work  which  is  to  be  done  under  his  di- 
rection, and  the  method  of  investigation  which  is  to  be  pur- 
sued? 

a.    By  whom  was  the  arrangement  with  Mr.  King  made? 

Answer:  Mr.  King  was  appointed  pursuant  to  a  resolution 
adopted  at  the  meeting  of  the  Executive  Committee  of  the 
Rockefeller  Foundation  held  August  13,  1914,  of  which  the 
following  is  a  copy : 

"Resolved:  That  William  Lyon  Mackenzie  King  be,  and 
he  is  hereby,  appointed  to  make  a  comprehensive  study  of  the 

problem  of  industrial  relations  at  a  salary  of  $ 

a  year  from  October  1,  1914. 

"It  was,  on  motion,  further 

* ' Resolved,  That  the  Secretary  be  authorized  to  approve  all 
bills  for  necessary  traveling  expenses  and  all  other  expenses 
incurred  by  Mr.  King  in  the  pursuance  of  his  work  under  the 
direction  of  the  Executive  Committee.  The  Secretary  pre- 
sented a  recommendation  from  Mr.  King  for  the  employment 
of  Robert  F.  Foerster,  Ph.  D.,  to  prepare  a  catalogue,  etc." 

The  amounts  of  the  salaries  have  been  omitted  as  being  in- 
formation of  a  confidential  nature  not  material  to  this  inquiry. 


261 


RECEIVED  APPROVAL  OF  COMMISSIONERS  WALSH, 
LENNON  AND  O'CONNELL. 

The  money  with  which  the  Rockefeller  Foundation  was  cre- 
ated and  is  maintained  consists  of  the  wages  of  workers  in 
American  industries.  These  wages  were  withheld  by  means 
of  economic  pressure,  violation  of  law,  cunning  and  violence, 
practiced  over  a  series  of  years  by  the  founder  and  certain  of 
his  business  associates. 

Under  the  law  as  it  now  exists,  it  is  impossible  to  recover 
this  money  and  pay  it  over  to  the  equitable  owners.  "We  there- 
fore recommend  that  appropriate  legislation  be  passed  by 
Congress,  putting  an  end  to  the  activities  of  this  foundation, 
wherever  the  Federal  law  can  be  made  effective,  and  that  the 
charter  granted  by  the  State  be  revoked,  and  that  if  the 
founders  have  parted  with  the  title  to  the  money,  as  they  claim 
they  have,  and  under  the  law  the  same  would  revert  to  the 
State,  it  be  taken  over  and  used  by  the  State  for  the  creation 
and  maintenance  of  public  works  that  will  minimize  the  de- 
plorable evil  of  unemployment,  for  the  establishment  of  em- 
ployment agencies  and  the  distribution  of  labor,  for  the  cre- 
ation of  sickness  and  accident  funds  for  workers,  and  for 
other  legitimate  purposes  of  a  social  nature,  directly  bene- 
ficial to  the  laborers  who  really  contributed  the  funds. 


Report  of  Commissioner  John  B.  Lennon 
on  Industrial  Education 


265 


REPORT    OF    COMMISSIONER    JOHN    B.    LENNON 
ON  INDUSTRIAL  EDUCATION. 

The  Commission  on  Industrial  Relations  gave  careful  study 
and  investigation  to  the  subject  of  industrial  or  vocational 
education.  We  found  the  general  subject  of  education,  wheth- 
er academic,  cultural  or  industrial,  so  exceedingly  important 
and  interesting  to  all  classes  of  citizens  as  to  warrant  a  brief 
statement  covering  especially  the  subject  of  the  pressing  need 
for  industrial  education  and  the  bearing  that  such  education 
would  have  upon  industrial  unrest. 

The  terms  "vocational"  or  " industrial"  education  aroused 
to  indicate  the  training  given  in  many  varieties  of  schools  and 
by  many  different  modes  of  teaching.  Our  attention  has  been 
almost  entirely  confined  to  a  study  of  that  kind  of  education 
which  has  to  do  with  the  preparation  of  boys  and  girls  for 
useful  employment  in  industry,  particularly  as  applied  to 
mechanical  and  agricultural  employment. 

DEMAND  FOR  INDUSTRIAL  EDUCATION. 

The  great  importance  of  this  subject  appears  to  be  fairly 
well  appreciated  by  every  class  of  our  citizenship,  trade  unions, 
employers'  organizations,  educators,  merchants,  legislators, 
and  so  forth.  The  universal  interest  in  this  subject  warrants 
the  conclusion  that  its  proper  solution  is  of  paramount  im- 
portance to  the  welfare  of  the  Nation,  in  order  to  estab- 
lish that  kind  of  education  that  will  enable"  the  boys  and 
girls  of  the  United  States  to  enter  upon  their  industrial 
life  properly  equipped  to  make  their  lives  a  success.  Our 
attention  has  been  forcibly  called  to  the  fact  that  the  great 
mass  of  the  wage  workers  are  without  any  accumulated  means. 
Their  children  are  therefore  compelled  to  enter  gainful  pur- 
suits at  an  early  age.  Therefore  the  great  need  that  our  sys- 
tem of  education  should  be  so  constructed  as  to  equip  these 
boys  and  girls  with  vocational  and  industrial  knowledge  that 


266 

would  make  them,  from  the  beginning,  useful  workers,  ena- 
bling them  to  earn  and  demand  a  living  wage  and  treatment 
that  will  not  be  injurious  to  their  future  welfare,  as  well  as  the 
opportunity  to  advance  from  time  to  time  in  their  chosen 
occupations. 

Among  the  tramps  and  hoboes,  also  in  the  ranks  of  those 
who  are  employed  only  when  labor  is  scarce,  we  have  found 
thousands  of  graduates  of  grammar  and  high  schools,  some 
even  having  the  advantage  of  a  university  education,  indicat- 
ing that  however  cultural  their  education  may  have  been,  it 
was  not  always  of  practical  value  in  the  mill,  in  the  shop,  or 
on  the  farm. 

Private  trade  schools  can  not  remedy  this.  They  are  oper- 
ated generally  in  the  interest  of  employers  and  do  not  give 
the  most  important  element  of  education,  namely,  the  interest 
of  the  workers  themselves,  the  consideration  it  deserves. 

The  private  training  school  can  not  cover  this  problem.  All 
boys  and  girls  require  this  practical  equipment  and  it  can  be 
secured  only  through  and  in  connection  with  our  system  of 
public  schools.  To  properly  perform  this  duty,  the  general 
responsibility  rests  on  all  our  people.  It  is  a  public  and  not  a 
private  function,  and  the  State  and  Nation  must  be  held  re- 
sponsible for  its  early  and  successful  solution. 

The  needs  of  modern  industry  do  not  seem  to  be  met  by 
any  existing  scheme  of  training  for  general  usefulness  in  the 
crafts  or  for  the  development  of  all-around  mechanics.  There- 
fore the  pressing  need  for  a  general  educational  policy  that 
will  make  possible  a  continuous  development  of  both  adults 
and  minors  in  industry  who  are  over  fourteen  years  of  age. 
Boys  or  girls  who  go  into  the  shop  at  14  or  later  develop  into 
specialists  but  not  mechanics.  If  for  any  reason  they  lose 
their  job  they  are  no  more  fit  for  another  place  than  they  were 
when  they  first  began.  The  work,  therefore,  that  must  be 
done  for  those  already  in  industry,  is  to  train  them  to  fit  into 
work  wherever  help  is  required  in  the  shop. 

Our  public  schools  must  be  prepared  and  required  not  only 
to  give  some  vocational  consideration  to  pupils  over  14  years 


267 

of  age  who  remain  in  the  schools,  but  to  provide  for  compul- 
sory continuation  daytime  schools  on  the  time  and  at  the  ex- 
pense of  employers,  and  voluntary  night  schools  for  both  aca- 
demic and  vocational  training  for  boys  and  girls  who  are  at 
work  and  for  adults  who  desire  further  knowledge  which  will 
be  of  use  in  their  vocation. 

We  hold  that  all  experience  shows  conclusively  that  public 
instruction  privately  controlled,  or  any  plan  that  fails  to  com- 
prehend the  entire  number  of  pupils  in  the  United  States,  is 
dangerous  and  unworthy  of  support. 

We  hold  that  the  advantages  of  vocational  education  should 
be  open  to  all  adults  or  minors  in  the  public  schools  if  they 
remain  after  14  years  of  age,  and  in  night  schools  and  con- 
tinuation schools  after  they  enter  industry,  and  these  advan- 
tages we  believe  should  be  provided  entirely  at  public  expense. 

There  seems  to  be  but  slight,  if  any,  advantage,  to  be  ob- 
tained by  undertaking  vocational  training  of  pupils  before 
they  reach  the  age  of  14.  Their  entire  time  prior  to  that  age 
is  required  to  lay  a  foundation  for  what  may  be  termed  their 
general  education.  This  being  true  beyond  any  question,  the 
State  must  provide  for  education  after  entrance  into  indus- 
trial life  as  well  as  before.  Fairness  to  all  classes  demands 
the  opportunity  for  vocational  teaching  after  the  boy  or  girl 
of  14  or  over  has  entered  industry. 

The  children  of  the  well-to-do  parents  are  continued  at 
school  through  the  several  years  of  high  school  work,  entirely 
at  public  expense,  in  order  to  fit  them  for  professions  and 
business  life.  Is  it  unreasonable  that  the  publie  should  equally 
provide  schooling  for  those  who,  because  of  economic  pressure, 
must  enter  industry  at  from  14  to  16  years  of  age? 

This  the  working  class  demands  for  their  children  and  it 
must  be  provided  if  our  public  school  system  is  to  continue 
to  hold  a  high  place  in  the  respect  and  esteem  of  all  classes  of 
our  citizens.  In  a  Republic,  such  as  the  United  States,  the 
school  system  should  be  adapted  to  the  needs  of  all  classes, 
rich  and  poor;  those  who  are  to  enter  professions  and  those 


268 

who  are  to  go  into  the  shop,  the  factory,  the  mill,  or  to  work 
upon  the  land. 

We  believe  it  to  be  assured  that  if  all  our  schools  will  extend 
practical  vocational  teaching  to  cover  instruction  after  14 
years  of  age,  a  very  large  number  of  pupils  will  remain  at 
school  until  the  age  of  16  or  even  later,  if  the  school  is  provid- 
ing for  their  future  usefulness  and  success  as  well  as  or  better 
than  can  be  done  in  the  factory.  This  is  the  most  important 
element  in  the  consideration  of  the  subject  of  industrial  train- 
ing. Keep  the  children  at  school  as  long  as  possible,  extend- 
ing their  vocational  knowledge,  widening  their  academic  train- 
ing, teaching  them  not  only  their  rights  but  their  duties  as 
citizens  of  our  Republic,  stirring  their  ambition  for  a  life 
worth  living,  and  making  of  them  dear  men  and  women  rather 
than  cheap. 

It  can  not  be  denied  that  our  public  schools,  as  now  gener- 
ally conducted,  do  not  accomplish  as  much  work  that  is  sub- 
stantially effective  in  fitting  their  pupils  for  productive  labor 
with  their  hands  as  should  be  the  case.  "We  must  have  a  plan 
of  education  in  the  school  that  develops  both  the  power  to 
think  and  the  power  to  do. 

We  find  that  as  a  rule  the  first  eight  years  of  the  school  life 
of  a  boy  or  girl  must  of  necessity  be  very  largely,  if  not  en- 
tirely, devoted  to  work  of  a  cultural  character,  for  the  reason 
that  up  to  the  age  of  14,  when  the  first  eight  years  of  school  life 
are  completed,  neither  boys  nor  girls  have  developed  any 
clearly  defined  likes  or  dislikes  as  to  what  their  life  work 
shall  be,  nor  can  either  parents  or  teachers  be  considered  safe 
guides  as  to  the  careers  of  children  of  that  age.  Justice,  as 
well  as  the  best  interest  of  the  pupil,  demands  that  the  desires 
and  wishes  of  the  child  shall  have  primary  consideration  in 
the  determining  of  his  life  work,  and  to  assign  this  work  arbi- 
trarily, either  by  the  school  board,  the  teacher,  or  even  the 
parents,  is  not  much  less  than  criminal. 

The  schools  should  provide  the  greatest  possible  variety  of 
occupations,  making  the  opportunity  of  choice  as  varied  as 
possible.    And  this  vocational  training  should  be  in  the  same 


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270 

such  academic  work  as  may  be  advisable  for  all  persons  ovei 
14  years  of  age  in  industry  and  agriculture. 

Education  vitally  interests  all  our  people  and  neither  money 
nor  time  should  be  spared  to  make  the  education  of  the  United 
States  the  most  thorough,  the  most  potent  for  human  uplift 
and  progress,  of  any  system  of  education  in  the  world.  To 
lead  in  this  great  work  is  our  proper  position,  not  to  follow. 
Thoroughness  should  be  the  aim  of  our  Nation  and  our  States. 
Poorly  trained  workers  in  industry  are  now  entirely  too  plen- 
tiful. This  should  be  overcome  by  excellent  vocational  train- 
ing. We  believe  there  are  now  too  many  cheap  workmen.  This 
Nation  should  work  for  men,  women,  and  children  who  will 
not  consent  to  cheapness,  either  in  wages,  conditions  of  labor, 
or  character. 

The  public  schools,  whether  academic  or  vocational,  should 
be  entirely  neutral  as  to  unions  and  their  control,  and  ex- 
actly the  same  should  be  true  as  to  the  exercise  of  any  control 
for  class  interests  by  employers  or  employers'  organizations. 
And  surely  there  is  no  room  in  our  schools  to  warrant  the 
teaching  of  any  degree  of  hostility  toward  trade  unions  or 
employers !  organizations. 

The  general  recommendations  of  the  special  commission  on 
National  Aid  to  Vocational  Education  have  our  most  hearty 
approval  and  we  approve  of  the  passage  of  a  law  by  the  Con- 
gress of  the  United  States  with  that  end  in  view.  The  need  of 
the  States  for  such  assistance  is  clearly  set  forth. 

It  is  recommended  that  Congress  authorize  by  law  the 
creation  of  a  Federal  Board  to  administer  funds  appropri- 
ated by  Congress  to  the  several  States  for  vocational  educa- 
tion, the  Board  to  consist  of  three  members,  one  educator, 
one  representative  of  organized  labor,  and  one  representa- 
tive of  organizations  of  employers,  to  be  appointed  by  the 
President  with  the  consent  of  the  Senate,  to  serve  for  a  term 
of  six  years,  the  first  appointments  to  be  for  two,  four  and 
six  years;  with  salaries  of  $8,000  each  per  annum;  the  Fed- 
eral Board  so  constituted  to  establish  rules  and  standards 
for  expenditure  of  Government  funds  awarded  to  the  sev- 
eral States. 


271 

The  Federal  Board  shall  require  of  each  State  asking  for 
Government  funds  the  adoption  of  the  following  standards 
before  any  awards  can  be  made  or  funds  be  appropriated  by 
the  Board : 

1.  Compulsory  daytime  continuation  schools  for  all 
children  in  industry  between  the  ages  of  14  and  18  years, 
for  not  less  than  five  hours  per  week  at  the  expense  of 
their  employers. 

2.  Night  schools  for  all  persons  over  18  years  of  age 
who  are  desirous  of  further  educational  opportunities 
either  cultural  or  vocational. 

3.  Standards  of  efficiency  for  teachers. 

4.  Joint  State  control  in  administration  of  Vocational 
Education  by  public  school  authorities,  organized  labor, 
and  organized  employers,  with  equal  representation. 

5.  The  Federal  Board  to  establish  some  model  schools 
for  industrial  training  in  agriculture  and  vocations,  as 
examples  to  the  several  States. 

This  problem  of  vocational  education  not  only  is  important 
materially  but  is  intimately  a  human  problem,  involving  as  it 
does  the  social  welfare  and  progress  of  all  the  people. 

The  boys  and  girls  of  the  farm,  if  assured  by  proper  edu- 
cation of  becoming  generally  successful  farmers,  will  remain 
farmers,  rather  than  undertake  to  compete  in  the  industries 
with  properly  trained  workers  of  the  cities.  This  will  help  to 
solve  the  problems  that  are  threatening  injury  to  our  great 
agricultural  industries,  and  will  eliminate  a  cause  of  industrial 
unrest. 

In  the  farming  districts  the  country  school  remains  practi- 
cally as  it  was  fifty  years  ago.  Pupils  are  not  taught  what  is 
essential  to  develop  them  into  excellent  farmers  and  farmers' 
wives,  but  the  cultural  education  of  days  gone  by  is  continued, 
to  the  considerable  exclusion  of  teaching  how  to  farm  and 
how  to  manage  a  farmer 's  home.  Surely  the  Nation  has  here 
a  mission  of  helpfulness  to  perform  that,  as  a  great  Nation, 


272 

it  can  not  longer  afford  to  leave  largely  neglected.  Its  pros- 
perity as  a  Nation  depends  upon  the  character  and  efficiency 
of  its  men  and  women  much  more  than  upon  its  geographical 
position  or  the  quality  of  its  soil,  and  to  build  character  and 
effectiveness  we  must  lay  the  foundations  well  by  a  proper 
education  of  our  boys  and  girls.  We  should  not  strive  merely 
for  educating  them  into  correctly  working  automatic  machines. 
The  human  side  must  be  uppermost  and  receive  attention  of 
the  most  careful  nature.  It  is  not  worth  while  to  make  square 
holes  and  then  try  to  fit  into  them  round  men  and  women. 

Education  should  take  into  account,  at  every  stage,  man- 
hood and  womanhood,  and  where  and  how  the  life  is  to  be 
surrounded,  and  what  can  be  done  through  education  to  make 
each  life  successful  and  therefore  worth  while.  Dexterity  is 
worth  while,  but  good  character  is  more  vital  to  real  service 
in  the  world  of  industry  and  civilization.  At  present  our 
schools  in  city  and  country  do  not  make  good,  either  in  the 
development  of  skill,  in  the  duties  of  service,  or  in  a  clear 
understanding  of  human  rights  and  consequent  human  duties 
toward  our  fellows.  Industrial  education  can  not  possibly  take 
the  place  of  industrial  experience.  All  that  can  be  hoped  for 
is  that  our  schools  will  make  their  teaching  a  real  preparatory 
process  for  entering  upon  industrial  life,  with  proper  concep- 
tion of  life  work,  instead  of  no  conception  at  all. 

CONTINUATION  OR  PART-TIME  SCHOOLS. 

All  minors  entering  industry  after  14  years  of  age  are  en- 
titled to  further  aid  from  organized  society  in  order  to  enable 
them  to  complete  their  vocational  and  cultural  education.  This 
is  possible  only  through  the  establishment  of  compulsory  day- 
time continuation  schools  of  at  least  five  hours  per  week  at 
the  expense  of  employers,  and  night  schools.  The  eagerness 
with  which  minors  and  adults  take  advantage  of  such  schools 
is  sufficient  evidence  to  warrant  legislation  giving  these  op- 
portunities to  all  minors  and  to  such  adults  as  may  care  to 
take  advantage  of  them.     These  schools,  in  order  to  be  of 


273 

value,  must  be  compulsory  upon  all  minors  in  industry  up  to 
at  least  18  years  of  age.  Schools  in  the  United  States  should 
meet  fully  the  needs  of  every  class  of  pupils,  those  who  expect 
to  enter  colleges  and  prepare  for  the  professions  as  well  as 
the  much  larger  class  that  is  to  enter  industrial  life.  The  par- 
ents of  the  wage  working  class  contend,  with  much  reason, 
that  their  children  are  not  given  the  same  vocational  consider- 
ation under  our  present  school  systems  as  are  the  children  of 
the  well-to-do  who  expect  to  become  lawyers,  doctors,  and  so 
forth. 

The  State  has  established  schools  to  train,  for  a  useful 
industrial  life,  the  mentally,  morally  and  physically  deficient, 
and  this  effort  has  the  hearty  approval  of  every  good  citizen. 
If  this  work  is  worth  doing,  then  it  must  be  of  vastly  greater 
importance  to  establish  one  general  scheme  of  education  so 
as  to  make  useful  men  and  women  out  of  the  normal  boy  and 
girl,  and  neither  expense  nor  investigation  should  be  spared 
to  accomplish  this  most  desirable  object. 


TEACHERS. 

It  seems  self-evident  that  no  one  can  successfully  teach 
others  that  of  which  he  has  no  knowledge  himself.  We  recom- 
mend, therefore,  in  the  selection  of  teachers  to  impart  trade 
education,  that  only  practical  workmen  shall  be  used.  They 
should  be  selected  with  care  as  to  character,  and,  as  far  as 
possible,  craftsmen  should  be  selected  as  trade  teachers  who 
have  a  considerable  degree  of  cultural  education.  The  oppor- 
tunity should  be  continually  extended  for  the  proper  education 
of  teachers  capable  of  teaching  vocations,  and,  in  so  far  as  it 
may  be  advantageous,  academic  education  also.  The  need  of 
well  developed  brain  power  is  not  waning  in  the  least.  What 
is  demanded  is  the  educated  hand  to  apply  in  industry  the 
ideas  and  knowledge  of  the  brain.  Our  children  need  to  know 
more  as  to  their  economic  value,  and  more  of  their  social  duties 
and  responsibilities.  The  schoolhouse  is  the  place  where  much 
of  this  should  be  taught,  in  order  that  the  duties  of  honorable 


274 

citizenship  shall  be  appreciated.  Real  social  service  is  the 
highest  attainment  the  individual  can  aspire  to  reach.  All 
education  is  of  value  in  life  and  the  State  should  properly  be 
held  responsible  for  the  education  of  her  children,  in  order 
that  the  best  possible  use  shall  be  made  by  the  greatest  pos- 
sible number  of  the  opportunities  of  life  as  they  present  them- 
selves from  year  to  year. 

CONCLUSIONS. 

The  existing  system  of  public  education  is  inadequate.  The 
present  specialization  of  shop  conditions  is  not  favorable  to  a 
complete  mastery  of  any  trade  or  calling  in  the  shop,  store  or 
industry.  This  being  admittedly  true,  it  devolves  on  our  pub- 
lic school  system  to  meet  adequately  the  emergency  in  con- 
junction and  cooperation  with  industry.  The  temperamental 
difference  in  children  must  have  consideration  in  determining 
their  life  work  and  preparation  therefor.  The  boy  or  girl  must 
not  become  merely  a  cog  in  the  great  wheel  of  industry.  There- 
fore the  urgent  need  of  vocational  education  in  conjunction 
with  practice  in  the  shop  or  factory  that  makes  each  individual 
in  a  few  years  capable  to  fit  into  any  place  in  the  industry 
where  help  may  be  required.  We  now  have  too  many  handy 
men  ar«i  specialists,  who  have  no  place  into  which  they  can  fit 
when  for  any  reason  their  particular  work  is  no  longer  re- 
quired. 

Vocational  education,  on  account  of  the  wonderful  changes 
in  industrial  production,  must  take  the  place  of  apprentice- 
ship. To  solve  this  problem  right  is  to  find  a  solution  for 
much  of  the  unnecessary  social  unrest  of  our  day  and  gener- 
ation. 

There  can  be  no  question  that  industrial  education  is  com- 
ing rapidly.  Prejudiced  opposition  will  be  futile.  The  neces- 
sity is  great  and  it  must  and  \vi\\  be  met.  The  National  Gov- 
ernment should  properly  perform  its  full  share  of  the  respon- 
sibilities of  meeting  this  demand  for  the  best  and  fullest  edu- 
cation of  our  children. 


275 

The  entire  subject  is  dealt  with  exhaustively  in  the  report 
of  the  Special  Commission  on  Vocational  Education,  which 
submitted  its  report  June  1,  1914. 

John  B.  Lennon. 

James  O'Connell. 

Austin  B.  Garretson. 

S.  Thruston  Ballard. 

Frank  P.  Walsh. 


Supplemental  Statements  of  Commissioners 

Lennon  and  O'Connell,  Garretson, 

and  Walsh 


279 


SUPPLEMENTAL  STATEMENT  OF  COMMISSIONERS 
JOHN  B.  LENNON  AND  JAMES  O'CONNEIX. 

Our  signatures  are  appended  to  the  report  of  Mr.  Basil  M. 
Manly,  Director  of  Research  and  Investigation  of  the  United 
States  Commission  on  Industrial  Relations,  submitted  to  the 
Commission  at  its  session  held  in  Chicago  during  the  months 
of  July  and  August,  1915,  except  that  portion  of  the  report 
recommending  a  system  of  mediation,  conciliation,  investiga- 
tion and  arbitration,  applicable  to  both  State  and  Nation, 
which  proposes  to  create  a  commission  of  three  members,  to- 
gether with  an  advisory  council  of  20  members,  10  represent- 
ing employers  and  10  representing  employees.  The  entire 
plan  is  set  forth  in  the  report  of  the  staff  as  submitted  to  the 
Commission  on  Industrial  Relations;  also  in  a  report  to  the 
Commission  by  Professor  George  E.  Barnett,  and  also  in  the 
report  of  Commissioner  John  R.  Commons.  From  these  re- 
commendations we  dissent  from  reasons  assigned  in  this  state- 
ment. 

The  evidence  submitted  to  the  Commission  at  public  hear- 
ings, together  with  the  evidence  secured  by  special  investiga- 
tors, has  been  fairly  set  forth  in  Mr.  Manly 's  report  and  with 
even  justice  to  all,  whether  employers,  employees  or  the 
public. 

CRITICISMS  NOT  JUSTIFIED. 

Our  fellow  Commissioners  wTho  are  representative  of  the 
employers,  contend  in  their  statement  that  the  report  of  Mr. 
Basil  M.  Manly  for  the  staff  is  deficient  in  that  it  does  not 
properly  present  an  indictment  against  labor  on  the  grounds 
of  fostering  and  promoting  violence  in  trade  disputes,  juris- 
dictional disputes  accompanied  by  strikes,  limitation  of  out- 
put, sympathetic  strikes,  contract  breaking,  apprenticeship 
rules,  refusal  to  use  nonunion  materials,  alleged  graft  and  so 
forth,  and  that  it  does  not  include  these  things  among  the 


280 

fundamental  causes  of  industrial  unrest.  All  the  evidence 
submitted  to  the  Commission,  as  we  understand  and  interpret 
it,  proves  that  these  things  in  so  far  as  they  do  exist  are  in 
no  sense  causes  of  industrial  unrest,  but,  on  the  contrary,  are 
evidences  of  existing  industrial  unrest  and  are  evils  that  are 
incidental  to  a  situation  wherein  labor  has  at  times  been 
forced  to  fight  with  such  weapons  as  it  could  command  for 
advantages  and  rights  that  in  justice  should  be  freely  ac- 
corded to  the  wage  earners.  So  long  as  labor  organizations 
are  forced  by  employers  to  fight  for  the  mere  right  to  exist, 
and  so  long  as  wages  paid  to  labor  are  so  low  that  the  un- 
organized wage  earner  often  sees  no  choice  except  that  be- 
tween resorting  to  such  weapons  or  seeing  himself  and  his 
family  sink  below  the  poverty  line,  just  so  long  will  these 
evils  at  times  manifest  themselves  as  symptoms  of  the  work- 
er's desperation.  The  union,  fighting  for  its  right  to  live, 
is  sometimes  forced  to  tolerate  acts  that  would  not  be  counte- 
nanced if  its  entity  were  secure  and  its  energies  were  not  ab- 
sorbed in  fighting  for  existence. 

STRONG  ORGANIZATIONS  THE  CURE. 

Experience  shows  that  the  evils  complained  of  rapidly  dis- 
appear in  labor  organizations  as  soon  as  the  organization 
prevails  over  the  opposition  of  the  employers  and  establishes 
its  right  to  organize.  Strong  unions  mean  decent  wages,  and 
decent  wages  raise  wage  earners  to  a  plane  of  thought  and 
action  where  all  their  acts  and  mental  processes  must  no  long- 
er be  directed  toward  a  desperate  struggle  for  the  very  right 
of  themselves  and  families  to  live. 

Organized  labor  fully  realizes  how  unfortunate  it  is  that 
labor  in  its  struggle  for  existence  has  occasionally  been  driven 
to  consider  its  immediate  advantage  at  the  expense  of  the  true 
economic  principles  that  must  govern  in  the  long  run.  All 
the  energies  of  organized  labor's  representatives  have  been 
exerted  to  minimize  or  eliminate  any  tendency  toward  lim- 
itation of  output  or  jurisdictional  disputes,  but,  at  the  same 


281 

time,  organized  labor  insists  that  these  tendencies  where  they 
exist  are  the  logical  and  inevitable  outgrowth  of  evils  in  in- 
dustry that  can  be  removed  only  by  trade  union  action  by  the 
wage  earners.    We  could  cite  evidence  at  great  length  to  show 
that  the  tendencies  complained  of  so  far  as  they  exist  at  all 
have  grown  out  of  the  hard  necessities  with  which  labor  has 
been  confronted.    It  is  enough  here  to  quote  briefly  from  the 
testimony  of  the  distinguished  economist,  Professor  Jacob  H. 
Hollander  of  Johns  Hopkins  University,  given  before  this 
Commission  in  New  York  City  on  January  20,  1915.     Pro- 
fessor Hollander  in  discussing  the  limitation  of  output  said: 
We  lose  sight  of  the  fact  that  trade  unions  and  unionists 
are  not  soldiering  in  the  matter,  but  they  are  animated 
by  a  very  high  degree  of  fraternity  in  the  matter,  that 
they  are  willing  to  adopt  the  same  principle  if  it  is  a 
matter  of  piece  work  instead  of  time  work,  that  the 
endeavor  of  society  should  be  to  bring  back  industrial 
conditions  from  that  unwholesome  mess  into  which  they 
have  slumped,  from  this  abnormal  disproportionate  allot- 
ment of  workers  to  particular  fields  in  excess  of  the  re- 
quirements in  those  fields.    We  must  without  deviating 
one  iota  from  the  proposition  which  you  have  stated  that 
it  is  socially  unsound  that  workmen  should  do  less  than 
they  properly  could — society  should  seek  to  bring  about 
conditions  where  they  will  do  what  they  can  without  in- 
volving displacement  and  unemployment  on  the  part  of 
their  fellow  workmen. 

We  hold  that  the  report  of  Mr.  Manly  contains  no  state- 
ment that  is  unworthy  of  credence  and  that  will  not  bear  care- 
ful investigation.  The  conclusions  and  recommendations  are 
warranted  by  the  statement  of  facts  and  the  accumulated  evi- 
dence in  the  hands  of  the  Commission. 


282 


THE  EVIDENCE. 

All  evidence  accumulated,  whether  by  special  investigators 
or  at  public  hearings,  will  be  submitted  to  Congress,  and  we 
trust  the  people  of  our  country  will  demand  that  it  be  pub- 
lished in  full,  particularly  the  following,  which  are  well  worth 
the  most  careful  study  by  all  persons  interested  in  human 
welfare.  The  reports  cited  below  have  been  prepared  by  com- 
petent investigators  and  were  submitted  to  the  Commission 
after  careful  investigation  and  verification  by  Director  Basil 
M.  Manly  and  by  members  of  the  Commission,  and  are  the 
latest  information  upon  the  various  subjects  covered  by  them. 

Evidence  Taken  at  All  Public  Hearings. 

Causes  of  Industrial  Unrest. .  .by  Mr.  W.  J.  Lauck. 

Violence  in  Labor  Disputes ...  by  Mr.  Luke  Grant. 

Structural  Iron  Workers by  Mr.  Luke  Grant. 

Sickness  Prevention  and  Insur- 
ance   by  Dr.  B.  S.  Warren. 

Mediation,  Arbitration  and  In- 
vestigation   by  Prof.  Geo.  E.  Barnett. 

Condition  of  Labor  in  Principal 
Industries   by  Mr.  Edgar  Sydenstricker. 

Efficiency  Systems  in  Industry,  by  Professor  Robert  F.  Hoxie, 

Mr.  John  P.  Frey,  and  Mr. 
Robert  G.  Valentine. 

Industrial  Education by  Com'r  John  B.  Lennon. 

Labor  Complaints  and  Claims. by  Mr.  P.  A.  Speek. 

Trade  Union  Law by  Mr.  J.  W.  Bryan. 

Colorado  Situation by  Mr.  George  P.  West. 

The  Telephone  and  Telegraph 

Industry by  Mr.  Christopher   T.    Chen- 

ery. 
Labor    Conditions    in    Porto 

Rico    by  Mr.  Christopher   T.    Chen- 

ery. 
Labor  Conditions  in  the  Black 
Hills by  Mr.  William  P.  Harvey. 


283 

Labor  Conditions  in  Los  An- 
geles   by  Mr.  William  P.  Harvey. 

Preliminary    Report    on    the 

Land  Question by  Mr.  Charles  W.  Holman. 

Agricultural  Labor  and  Ten- 
ancy   by  Mr.  John  L.  Coulter. 

Unemployment by  Mr.  "William  M.  Leiserson. 

Extent  and  Growth  of  Labor 
Organizations by  Mr.  Lee  Wolman. 

Injunctions  in  Labor  Disputes. by  Mr.  Edwin  E.  Witte. 
The  Inferior  Courts  and  Police 

of  Paterson,  N.  J by  Mr.  Redmond  S.  Brennan 

and  Mr.  Patrick  F.  Gill. 

Chinese  Exclusion by  Mr.   Edward   A.   Fitzpat- 

rick. 


EXTENT  OF  UNREST. 

The  principal  duty  imposed,  under  the  law  creating  the  Com- 
mission, was  to  seek  to  ascertain  the  causes  of  industrial  un- 
rest and  offer  such  recommendations  as  we  believe  might  alle- 
viate that  unrest.  There  can  be  no  question  but  that  unrest 
exists,  in  some  instances,  to  an  alarming  extent.  Thousands 
and  tens  of  thousands  of  our  people  feel  that  they  are  de- 
prived, under  existing  conditions  in  industry,  of  an  oppor- 
tunity to  secure  for  themselves  and  their  families  a  standard 
of  living  commensurate  with  the  best  ideals  of  manhood,  wom- 
anhood and  childhood.  They  resent  the  fact  that  the  existing 
system  of  the  distribution  of  wealth  creates  at  one  end 
of  our  industrial  scale  a  few  multi-millionaires  and  at  the 
other  end  thousands  and  tens  of  thousands  of  men,  women 
and  children  who  are  at  all  times  in  a  situation  where  they 
are  uncertain  as  to  where  their  next  meal  will  come  from. 
Hungry,  poorly  clothed  and  without  the  opportunities  that 
a  fully  rounded  life  requires,  they  become  filled  with  a  sullen 
resentment  that  bodes  no  good  for  the  future  of  our  Republic. 

We  have  found  men  and  women  who  are  inclined  to  ascribe 


284 

this  condition  to  the  fact  that  the  Government  exercises  no 
power  of  mandatory  character  to  prevent  strikes  and  lock- 
outs. Many  have  been  the  propositions  submitted  to  us  for 
compulsory  arbitration  or,  at  least,  compulsory  investigation 
with  power  to  recommend  a  settlement.  Some  have  proposed 
an  elaborate  machinery  to  be  set  up  by  the  general  Govern- 
ment, and  of  a  similar  character  by  the  States,  providing  for 
concilation,  mediation,  arbitration  and  investigation,  all  of 
which,  while  without  definite  compulsory  features,  establish  a 
legal  machinery  that  must  of  necessity  exercise  an  influence 
in  that  direction. 

The  plan  for  the  creation  of  an  industrial  commission,  both 
National  and  State,  proposes  to  assign  to  a  commission  of 
three  members  the  administration  of  all  labor  laws  of  either 
State  or  Nation,  giving  to  them  powers  far  in  excess  of  those 
exercised  by  the  President  of  the  United  States,  or  the  Gov- 
ernor of  any  State.  This  we  believe  to  be  Bureaucracy  run 
mad,  and  a  subversion  of  Democracy  dangerous  to  the  civil 
and  social  liberty  of  all  citizens.  We  hold  that  all  power 
should  be  in  the  final  analysis  with  the  people,  and  we,  there- 
fore, dissent  from  any  such  plan. 

NEW  GOVERNMENTAL  MACHINERY  UNWISE. 

The  activities  of  such  a  Commission  supplemented  by  the 
proposed  advisory  committees  of  employers  and  labor  repre- 
sentatives would  be  so  balanced  as  to  prevent  substantial 
progress,  and  tend  to  perpetuate  present  conditions.  Such 
a  plan  conceives  of  labor  and  capital  as  static  forces  and  of 
the  relations  between  them  as  always  to  remain  unchanging. 

We  believe  that  the  work  now  being  done  by  the  Depart- 
ment of  Labor  in  industry  generally,  and  by  the  Board  of 
Mediation  and  Conciliation,  dealing  with  interstate  public 
utilities,  is  better  than  any  that  could  be  expected  of  any  ad- 
ditional board  that  has  been  suggested  to  this  Commission. 
We  believe  that  the  Department  of  Labor,  with  further  ex- 
perience and  larger  appropriations,  will  develop  a  high  state 


285 

of  efficiency  in  adjusting  labor  disputes  that  are  capable  of 
being  adjusted  by  any  one  other  than  the  parties  directly  in- 
terested, and  will  adequately  carry  on  the  work  provided  by 
the  law  creating  the  Department  of  Labor,  to  wit : 

Section  1.  The  purpose  of  the  Department  of  Labor 
shall  be  to  foster,  promote  and  develop  the  welfare  of 
the  wage  earners  in  the  United  States,  to  improve  their 
working  conditions  and  to  advance  their  opportunities 
for  profitable  employment. 

Section  8.  The  Secretary  of  Labor  shall  have  power 
to  act  as  mediator  and  to  appoint  commissioners  of  con- 
ciliation in  labor  disputes  whenever  in  his  judgment  the 
interests  of  industrial  peace  require  it  to  be  done. 

We  favor  the  extension  of  the  Newlands  Act  to  cover  all 
employees  engaged  in  interstate  commerce,  such  as  the  rail- 
road telegraphers,  the  shop  and  track  men  employed  by  rail- 
roads, the  employees  of  express  companies,  of  the  Pullman 
Company,  of  commercial  telegraph  and  telephone  companies, 
and  other  public  utilities  performing  interstate  service  that, 
in  the  interest  of  the  Nation,  must  be  continuous. 

The  evidence  submitted  to  this  Commission  is  substantially 
to  the  effect  that  where  trade  union  organization  exists  among 
the  workers,  there,  at  the  same  time,  exists  the  least  amount  of 
industrial  unrest  of  a  character  that  is  dangerous  to  the  peace 
and  welfare  of  our  Nation.  It  is  true  that  the  union  men  and 
women  are  not  satisfied  with  their  conditions;  they  are  not, 
however,  despondent  as  to  the  possibility  of  securing  better 
conditions;  they  know  what  the  unions  have  accomplished, 
and  they  have  an  abiding  faith  that  their  further  desires  can 
be  attained. 

Instead  of  any  elaborate  machinery  for  the  prevention  of 
strikes  or  lockouts  we  are  convinced,  from  the  testimony  gath- 
ered by  this  Commission,  that  the  most  effectual  course  that 
can  be  pursued  to  bring  about  general  contentment  among 
our  people,  based  upon  a  humane  standard  of  living,  is  the 
promotion  of  labor  organization.    The  most  casual  investi- 


286 

gator  will  soon  discover  that  in  those  lines  of  industry  where 
organization  of  labor  is  the  strongest,  there  is  the  least  dan- 
ger of  industrial  revolt  that  would  endanger  the  fundamental 
principles  of  our  Government  and  the  maintenance  of  a  na- 
tion with  respect  for  law  and  order.  Where  organization  is 
lacking,  dangerous  discontent  is  found  on  every  hand;  low 
wages  and  long  hours  prevail ;  exploitation  in  every  direction 
is  practiced;  the  people  become  sullen,  have  no  regard  for 
law  or  government  and  are,  in  reality,  a  latent  volcano,  as 
dangerous  to  society  as  are  the  volcanoes  of  nature  to  the 
landscape  surrounding  them. 

THE  ONE  TRUE  REMEDY. 

We,  therefore,  urge  as  the  great  remedy  for  such  unnec- 
essary industrial  unrest  as  we  have  found,  more,  and  more, 
and  still  more,  organization  of  labor  and  of  the  employers 
in  each  industry  as  well.  The  education  of  the  trade  unions 
has  been  conducive  to  a  higher  and  better  citizenship.  In 
recent  years  there  have  come  to  our  assistance  scores  and 
hundreds  and  thousands  of  people  outside  the  ranks  of  union- 
ists— ministers,  professors,  journalists,  professional  men  of 
all  kinds — who  have  reached  the  conclusion  that  is  herein 
stated,  that  the  most  efficient  cure  for  such  industrial  unrest 
as  should  be  cured,  is  union  organization. 

We  hold  that  efforts  to  stay  the  organization  of  labor  or  to 
restrict  the  right  of  employees  to  organize  should  not  be  toler- 
ated, but  that  the  opposite  policy  should  prevail  and  the  or- 
ganization of  the  trade  unions  and  of  the  employers'  organi- 
zations should  be  promoted,  not,  however,  for  the  sole  pur- 
pose of  fighting  each  other,  but  for  the  commendable  purpose 
of  collective  bargaining  and  the  establishing  of  industrial  good 
will.  Organizations  of  employers  that  have  no  object  in  view 
except  to  prevent  labor  having  a  voice  in  fixing  the  conditions 
of  industry  under  which  it  is  employed,  have  no  excuse  for 
existence,  as  they  are  a  bar  to  social  tranquility  and  a  detri- 
ment to  the  economic  progress  of  our  country.    The  evidence 


287 

before  the  Commission  shows  that  organized  labor  has  no  de- 
sire, nor  has  it  attempted,  to  control  the  business  of  the  em- 
ployer. It  insists  that  it  has  a  right  to  a  voice,  and  a  potent 
voice,  in  determining  the  conditions  under  which  it  shall  work. 
This  attitude,  we  are  sure,  will  be  continued  in  spite  of  the 
opposition  of  any  so-called  employers'  organizations.  This 
country  is  no  longer  a  field  for  slavery,  and  where  men  and 
women  are  compelled,  in  order  that  they  may  live,  to  work 
under  conditions  in  determining  which  they  have  no  voice, 
they  are  not  far  removed  from  a  condition  existing  under 
feudalism  or  slavery. 

In  emphasizing  with  all  the  force  at  our  command  the  ne- 
cessity of  collective  action  by  wage  earners  through  strong 
organizations,  if  the  problem  of  industrial  unrest  is  to  be 
solved,  we  wish  again  to  quote  from  testimony  of  Professor 
Hollander.  He  undertook  to  sum  up  for  this  Commission 
those  conclusions  regarding  the  solution  of  this  problem  that 
have  been  reached  not  only  by  himself,  but  by  the  great  body 
of  economists  in  this  country  and  abroad.    He  said: 

The  opinion  of  political  economists  in  so  far  as  I  can 
voice  it  is  that  social  unrest,  which  is  manifest  not  only 
in  this 'country  but  in  every  industrial  country,  is  due 
to  the  existence  of  economic  want  or  poverty,  if  by  that 
we  understand  not  on  the  one  hand  pauperism  or  on  the 
other  economic  inequality.  By  poverty  I  mean  the  exist- 
ence of  large  areas  of  industrial  society  in  receipt  of  in- 
comes less  than  enough  to  maintain  themselves  and  those 
dependent  upon  them  in  decent  existence.  We  believe  that 
is  the  consequence,  not  of  any  absolute  dearth— that  the 
world  produces  enough  to  go  around,  that  it  is  therefore 
not  a  question  of  insufficient  production,  but  of  defects 
in  distribution.  *  *  *  There  is  a  view  among  econ- 
omists that  there  is  nothing  in  any  current  theory  of 
wages  that  precludes  the  laborer  from  obtaining  a  suffi- 
cient wage,  and  that  if  he  fails  it  must  be  in  consequence 
of  the  fact  that  he  enters  into  the  wage  contract  on  a 
plane  of  inequality.    The  wage  contract,  in  short,  is  the 


288 

result  of  a  bargain  between  the  employer  and  the  em- 
ployee, and  if  the  employer  is  in  a  superior  competitive 
position  by  reason  of  combination  and  the  laborer  is  un- 
organized, he  is  at  a  bargaining  disadvantage  which  is  cer- 
tain to  redound  to  his  hurt. 

I  think  political  economists  accordingly  then  are  in 
agreement  that  trade  unionism  is  essential  as  a  means  of 
bringing  the  workmen  into  industrial  bargaining  on  a 

plane  of  equality. 
•     •     •     • 

You  have  asked  specifically  what  the  remedy  [for  pov- 
erty] is.  It  means  a  very  decided  revulsion  of  opinion  as 
to  trade  unionism.  The  general  attitude  among  employ- 
ers of  labor  is  often  open  and  decided  opposition  to  or- 
ganized labor.  Until  society  recognizes  the  unwisdom 
of  that  attitude  and  demands  that  the  laborer  must  enter 
into  his  wage  bargain  on  a  plane  of  competitive  equality, 
society  has  not  lifted  its  finger  to  remedy  that  evil. 

THE  PUBLIC'S  DUTY. 

We  submit  the  report  of  Mr.  Basil  M.  Manly  as  our  report, 
asking  for  it  the  fullest  possible  consideration  by  the  men  and 
women  of  our  country  who  are  interested  in  the  social  and 
moral  uplift  of  humanity. 

Labor  must  work  out  its  own  salvation.  Wage  workers  can 
attain  that  degree  of  well-being  to  which  they  are  entitled 
only  by  their  own  efforts.  The  general  public  can  not  be  ex- 
pected to  do  for  them  what  they  fail  to  do  for  themselves,  nor 
would  it  be  desirable  that  those  rights  and  benefits  to  which 
they  are  entitled  should  be  handed  down  to  them  by  the  Gov- 
ernment or  by  organized  society  as  grace  from  above.  But 
the  general  public  is  vitally  interested  in  the  efforts  of  wage 
workers  to  win  for  themselves  equal  justice  and  such  a  degree 
of  material  well-being  as  will  enable  them  to  maintain  them- 
selves and  their  families  in  comfort,  security  and  health.  So- 
ciety's interest  in  the  triumph  of  labor's  cause  should  spring 


289 

not  only  from  the  love  of  justiee  and  the  human  sympathy  that 
animates  every  good  citizen,  but  from  a  realization  that  in- 
dustrial and  social  evils  menacing  large  groups  of  the  popu- 
lation can  not  continue  without  eventually  bringing  disaster 
to  society  as  a  whole.  While  inviting  the  aid  of  every  good 
citizen,  we,  as  representatives  of  organized  labor,  urge  that 
this  aid  be  directed  not  solely  to  seeking  new  legislation  or  new 
Governmental  machinery  designed  as  a  cure-all,  but  to  giving 
moral  support  to  labor's  own  efforts,  and  insisting  that  trade 
unions  be  fostered  and  encouraged  as  the  most  effective  agen- 
cies making  for  the  wage  workers'  progress. 

We  concur  in,  and  adopt  as  a  part  of  our  report,  the  state- 
ment under  the  heading  "  Supplemental  statement  of  Chair- 
man Frank  P.  Walsh." 

We  concur  in  the  dissenting  opinion  of  Chairman  Frank  P. 
Walsh  from  the  Report  of  Commissioners  John  R.  Commons 
and  Florence  J.  Harriman. 

We  concur  in  that  part  of  the  report  of  Commissioner 
Austin  B.  Garretson  under  the  heading  "Causes  underlying 
industrial  unrest." 

We  concur  in  the  history  and  statement  of  facts  regard- 
ing the  Colorado  Strike,  as  written  by  Mr.  George  P.  West, 
which  is  printed  as  an  addendum  to  this  report. 

John  B.  Lennon. 
James  O'Connell. 


291 


SUPPLEMENTAL  STATEMENT  OF  COMMISSIONER 
AUSTIN  B.  GARRETSON. 

My  signature  is  appended  to  the  Report  of  Mr.  Basil  M. 
Manly,  Director  of  Research  and  Investigation  of  the  United 
States  Commission  on  Industrial  Relations,  submitted  to  the 
Commission  and  transmitted  herewith,  as  to  the  findings  of 
fact  contained  therein. 

I  am  in  general  agreement  with  the  recommendations  con- 
tained in  that  Report  except  as  to  the  formation  of  the  system 
of  State  and  Federal  Commissions  and  a  Federal  Industrial 
Council. 

On  this  recommendation  I  neither  approve  nor  condemn. 
But  out  of  regard  for  the  opinion  of  the  great  body  of  intra- 
state labor  most  directly  affected,  I  dissent. 

I  am  also  in  accord  with  the  statement  of  fact  contained 
in  the  Report  of  George  P.  West  on  the  Colorado  situation. 

I  am  favorable  to  the  extension  of  the  provisions  of  the 
Newlands  Act  to  all  classes  of  interstate  employees  who  can 
constitutionally  be  brought  under  its  provisions  and  would 
favor  the  enlargement  of  the  body  administering  it  to  meet 
the  added  responsibilities  which  would  thereby  be  placed 
upon  it,  but  limiting  the  powers  thereof  to  the  settlement  of 
industrial  disagreements  and  to  the  gathering  of  information 
germane  to  their  mission. 

I  favor  the  creation  of  State  Commissions,  similarly  consti- 
tuted and  acting  in  corelation  and  understanding  with  the 
Federal  Board. 

I  heartily  concur  with  the  Report  of  Commissioners  Lennon 
and  O'Connell  except  on  those  points  where  disagreement  is 
herein  noted.  I  dissent  in  whole  from  report  rendered  by 
Commissioner  J.  R.  Commons.  I  render  individual  opinion 
and  suggestion  only  on — 


292 


Causes  Underlying  Industrial  Unrest. 

Any  student  who  accepts  and  applies  the  belief  that  the 
"proper  study  of  mankind  is  man"  can  not  fail  to  trace  cer- 
tain fundamental  causes,  general  in  their  character,  which  un- 
derlie industrial  unrest,  which  will  continue  to  grow  until 
either  the  causes  are  peacefully  removed  or  revolution  ensues. 

To  me,  there  appear  to  be  four  of  these  basic  causes. 

The  first  lies  in  the  inequitable  distribution  of  the  fruits  of 
industry. 

Our  industrial  system  makes  it  possible  for  one  man,  in 
only  a  portion  of  the  span  of  human  productive  life,  to  take 
unto  himself  and  claim  as  his  own  a  fortune  of  a  hundred 
million  dollars  or  more,  while  millions  of  deserving  men,  avail- 
ing themselves  of  every  opportunity  for  unremitting  toil,  are 
only  able  to  secure  a  grave  in  the  potters'  field  or  else  burden 
their  families  with  an  installment  debt  for  the  cost  of  in- 
terment. 

The  creation  of  such  colossal  fortune  naturally  breeds  in  the 
mind  of  the  possessor  the  sentiment,  belief  and  practice  that 
he  is  superior  to  society  and  not  subject  to  the  law.  The 
possession  thereof  makes  him  unregardful  of  the  opinions  of 
society  or  of  the  mandates  of  the  law,  incites  him  to  disregard 
and  hold  himself  independent  of,  the  moral  precepts  and  be- 
liefs of  society  and  tends  toward  the  effort  to  prostitute  the 
administration  of  justice,  and,  under  the  present  system,  ren- 
ders him  practically  immune  from  the  penalties  prescribed  by 
the  law. 

The  transmission  to  heirs  or  trustees,  degenerate  or  other- 
wise, of  fortunes  so  vast  or  of  business  interests  so  far-reach- 
ing makes  them  the  virtual  arbiters  of  the  destiny  of  hundreds 
of  thousands  of  their  fellow  beings,  in  regard  to  whom  they 
have  neither  sympathetic  feeling,  intelligent  interest  nor  hu- 
manitarian desire,  and  the  testimony  before  this  Commission 
has  made  it  evident  that  in  some  instances  these  heirs  or 
representatives  even  resent  the  imputation  that  any  obligation 


293 

whatever  can  rest  upon  them  for  the  welfare  of  the  said  fellow 
beings  or  that  even  intelligent  knowledge  as  to  what  would 
constitute  well-being  should  be  required  of  them. 

Second,  the  methods  of  the  formation  and  administration  of 
law  would,  in  themselves,  justify  undying,  righteous  unrest 
from  the  fact  that  they  create,  encourage  and  demonstrate 
knowledge  and  belief  that  there  is  no  equality  before  the  law 
as  between  the  man  who  has  and  the  man  who  has  not. 

Primarily,  there  is  the  trend  through  legislation  to  exalt 
the  property  right  at  the  expense  of  the  personal  right.  Next, 
the  tendency  of  a  great  majority  of  our  courts  to  extend  and 
amplify  this  trend.  This  appears  in  the  declaring  unconsti- 
tutional of  a  great  portion  of  the  legislation  that  in  later  years 
is  appearing  if  it  in  any  way  restricts  the  rights  of  property, 
while  at  the  same  time  any  legislative  act  which  tends  to 
make  effective  the  constitutional,  personal  right  of  the  individ- 
ual is  nullified  upon  the  same  ground. 

In  other  words,  to  exalt  money  above  man. 

The  tendency,  also,  of  a  large  number  of  the  same  tribunals 
is  to  legalize  the  maintenance  of  armed  forces,  either  by  the 
corporation  or  the  large  individual  employer,  and  the  virtual 
lowing  of  war  through  the  use  of  the  State  militia  as  a  private 
guard  for  property  interests,  or  as  an  economic  weapon  for 
the  purpose  of  prejudicing  the  interests  of  the  worker,  is 
abetted  and  approved,  while  at  the  same  time  rigorously 
prosecuting  and  punishing  the  individual  for.  taking  any  sim- 
ilar action,  individually  or  collectively,  in  defense  of  his  per- 
son or  his  family. 

Thus,  the  man  who  uses  a  deadly  weapon  to  protect  him- 
self or  his  home  against  the  aggression  of  hired  thugs,  has 
set  in  motion  against  him  the  whole  machinery  of  the  State, 
while  the  corporation  which  enlisted,  equipped  and  paid  a  pri- 
vate armed  force,  formed  and  used,  not  for  the  maintenance 
of  peace  or  the  protection  of  property,  but  solely  as  an  eco- 
nomic weapon,  is  lauded  as  a  conservator  of  peace,  law  and 
order. 


294 

Our  laws  deal  strictly  and  effectively  with  those  who  con- 
tribute to  the  delinquency  of  an  individual  but  the  hirelings  of 
a  corporation  may  debauch  a  State  for  their  own  economic 
gain  and  receive  only  laudation  from  those  who  ''sit  in  the 
seats  of  the  mighty." 

The  man,  who,  on  account  of  hunger  of  himself  or  family, 
steals  a  loaf,  is  held  up  to  public  view  as  a  "horrible  example" 
of  the  increase  of  crime  and  decadence  of  the  moral  sense, 
while  he  who  exploits  the  public  or  by  dishonest  or  fraudulent 
representation  or  manipulation,  secures  millions  of  their 
money  is,  by  the  same  agencies,  held  up  to  the  youth  of  the 
land  as  an  example  of  what  intelligent  effort  and  devotion  to 
business  may  accomplish. 

The  system  of  wholesale  arrests  during  industrial  disturb- 
ances for  acts  which,  committed  under  ordinary  conditions 
and  when  no  industrial  disturbances  prevailed  would  not  con- 
stitute ground  for  arrest,  is  one  of  the  significant  indications 
of  the  use  of  Governmental  agencies,  not  as  a  preserver  of 
peace  but  as  a  purely  economic  weapon. 

The  intrusion  of  what  has  been  aptly  described  as  "invisible 
government' 'into  all  the  channels  of  life — the  educational  sys- 
tem, primary,  secondary  and  higher,  the  church,  the  press, 
the  legislative  branch  and  the  judicial  system — and  the  recog- 
nized potency  of  its  meretricious  efforts,  contributes  its  ele- 
ments to  the  whole. 

Third,  irregularity  of  employment  with  the  consequent  re- 
striction of  opportunity  and  with  its  consequent  extension  of 
belief  that  unremitting  toil  under  present  conditions  can  bring 
no  fair  recompense,  thus  stifling  healthy  incentive  to  labor,  is 
creating  an  army  of  unemployed  that  must,  in  the  last  analy- 
sis, be  reckoned  with  and  unless  remedy  is  found  whereby 
incentive  may  be  restored  and  recompense  be  made  apparent, 
society  itself  must  pay  the  forfeit. 

Fourth,  land  monopoly  with  resulting  prohibitive  price, 
the  greatest  influence  in  creating  congestion  in  the  cities, 
bears  its  own  share  of  the  responsibility  for  unrest. 


295 

Tracing  the  history  of  every  vanished  civilization  makes  ap- 
parent the  fact  that  in  every  instance  decadence  was  pre- 
ceded by  urban  congestion  and  by  immense  land  holdings  by 
the  aristocrat  or  the  capitalist. 

As  to  the  remedy  for  these  evils,  an  income  and  inheritance 
tax  that  would  be,  above  a  certain  figure,  absolutely  confisca- 
tory, would  make  impossible,  first,  the  creation,  and  second, 
the  transmission  of  the  dominating  accumulation  of  wealth  in 
the  hands  of  any  individual,  group  or  family.  When  the  un- 
limited power  of  reward  or  purchase  had  ceased  to  exist,  the 
subconscious  tendency  of  legislatures  and  of  those  who  in- 
terpret and  administer  the  law  to  be  subservient  to  property 
interests  would,  of  necessity,  disappear. 

It  is  worth  consideration  as  to  whether  or  not  a  limitation 
can  properly  be  set  upon  profit  in  a  business  enterprise. 

Every  code,  ancient  and  modern,  prescribes  penalties  for 
usury,  and  modern  codes  define  the  rate  of  interest  permitted. 
Therefore,  if  a  man  loans  money,  he  can  only  demand  what  is 
described  as  the  legal  rate  for  the  use  thereof. 

Is  it,  or  is  it  not,  equally  consistent  for  the  Government 
to  prescribe  a  rate  beyond  which  profit  shall  not  extend? 

In  the  question  of  dealing  with  land,  should  not  the  same 
doctrine  be  applied  to  land  that,  in  the  arid  States,  is  applied 
to  water,  i.  e.,  that  no  more  land  can  be  held  by  an  individual 
than  he  can  put  to  productive  ''use",  thus  making  unused 
land  revert  to  the  State  and  acquirable  by  .those  who  would 

utilize  it! 

A.  B.  Gakretson. 


297 


SUPPLEMENTAL    STATEMENT    OF    CHAIRMAN 
FRANK    P.    WALSH. 

Charged  by  your  Honorable  Body  with  an  investigation  to 
discover  the  underlying  causes  of  dissatisfaction  in  the  in- 
dustrial situation,  we  herewith  present  the  following  findings 
and  conclusions,  and  we  urge  for  them  the  most  earnest  con- 
sideration, not  only  by  the  Congress,  but  by  the  people  of  the 
Nation,  to  the  end  that  evils  which  threaten  to  defeat  Amer- 
ican ideals  and  to  destroy  the  well-being  of  the  Nation  may 
be  generally  recognized  and  effectively  attacked. 

We  find  the  basic  cause  of  industrial  dissatisfaction  to 
be  low  wages  ;  or,  stated  in  another  way,  the  fact  that  the 
workers  of  the  nation,  through  compulsory  and  oppressive 
methods,  legal  and  illegal,  are  denied  the  full  product  of 
their  toil. 

We  further  find  that  unrest  among  the  workers  in  industry 
has  grown  to  proportions  that  already  menace  the  social  good- 
will and  the  peace  of  the  Nation.  Citizens  numbering  millions 
smart  under  a  sense  of  injustice  and  of  oppression,  born  of 
the  conviction  that  the  opportunity  is  denied  them  to  acquire 
for  themselves  and  their  families  that  degree  of  economic  well- 
being  necessary  for  the  enjoyment  of  those  material  and  spir- 
itual satisfactions  which  alone  make  life  worth  living. 

Bitterness,  bred  of  unfilled  need  for  sufficient  food,  clothing 
and  shelter  for  themselves  and  their  wives  and  children,  has 
been  further  nourished  in  the  hearts  of  these  millions  by  re- 
sentment against  the  arbitrary  power  that  enables  the  em- 
ployer, under  our  present  industrial  system,  to  control  not 
only  the  workman's  opportunity  to  earn  his  bread,  but  ofttimes 
through  the  exercise  of  this  power,  to  dictate  his  social,  polit- 
ical and  moral  environment.  By  thwarting  the  human  passion 
for  liberty  and  the  solicitude  of  the  husband  and  father  for 
his  own,  modern  industry  has  kindled  a  spirit  in  these  dis- 
satisfied millions  that  lies  deeper  and  springs  from  nobler 
impulses  than  physical  need  and  human  selfishness. 


298 

Among  these  millions  and  their  leaders  we  have  encountered 
a  spirit  religions  in  its  fervor  and  in  its  willingness  to  sacri- 
fice for  a  cause  held  sacred.  And  we  earnestly  submit  that 
only  in  the  light  of  this  spirit  can  the  aggressive  propaganda 
of  the  discontented  be  understood  and  judged. 

The  extent  and  depth  of  industrial  unrest  can  hardly  be  ex- 
aggerated. State  and  national  conventions  of  labor  organiza- 
tions, numbering  many  thousands  of  members,  have  cheered 
the  names  of  leaders  imprisoned  for  participation  in  a  cam- 
paign of  violence,  conducted  as  one  phase  of  a  conflict  with  or- 
ganized employers.  Thirty  thousand  workers  in  a  single  strike 
have  followed  the  leadership  of  men  who  denounced  govern- 
ment and  called  for  relentless  warfare  on  organized  society. 
Employers  from  coast  to  coast  have  created  and  maintained 
small  private  armies  of  armed  men  and  have  used  these  forces 
to  intimidate  and  suppress  their  striking  employees  by  de- 
porting, imprisoning,  assaulting  or  killing  their  leaders.  Elab- 
orate spy  systems  are  maintained  to  discover  and  forestall 
the  movements  of  the  enemy.  The  use  of  State  troops  in  polic- 
ing strikes  has  bred  a  bitter  hostility  to  the  militia  system 
among  members  of  labor  organizations,  and  States  have  been 
unable  to  enlist  wage  earners  for  this  second  line  of  the  Na- 
tion's defense.  Courts,  legislatures  and  governors  have  been 
rightfully  accused  of  serving  employers  to  the  defeat  of  jus- 
tice, and,  while  counter  charges  come  from  employers  and  their 
agents,  with  almost  negligible  exceptions  it  is  the  wage  earners 
who  believe,  assert  and  prove  that  the  very  institutions  of 
their  country  have  been  perverted  by  the  power  of  the  em- 
ployer. Prison  records  for  labor  leaders  have  become  badges 
of  honor  in  the  eyes  of  many  of  their  people,  and  great  mass 
meetings,  throughout  the  Nation,  cheer  denunciations  of  courts 
and  court  decisions. 

To  the  support  of  the  militant  and  aggressive  propaganda 
of  organized  labor  has  come,  within  recent  years,  a  small  but 
rapidly  increasing  host  of  ministers  of  the  gospel,  college  pro- 
fessors, writers,  journalists  and  others  of  the  professional 
classes,  distinguished  in  many  instances  by  exceptional  talent 


299 

which  they  devote  to  agitation,  with  no  hope  of  material  re- 
ward, and  a  devotion  that  can  be  explained  only  in  the  light 
of  the  fervid  religious  spirit  which  animates  the  organized 
industrial  unrest. 

We  find  the  unrest  here  described  to  be  but  the  latest  mani- 
festation of  the  age-long  struggle  of  the  race  for  freedom  of 
opportunity  for  every  individual  to  live  his  life  to  its  highest 
ends.  As  the  nobles  of  England  wrung  their  independence 
from  King  John,  and  as  the  tradesmen  of  France  broke 
through  the  ring  of  privilege  enclosing  the  Three  Estates,  so 
today  the  millions  who  serve  society  in  arduous  labor  on  the 
highways,  and  aloft  on  scaffoldings,  and  by  the  sides  of 
whirring  machines,  are  demanding  that  they,  too,  and  their 
children,  shall  enjoy  all  of  the  blessings  that  justify  and  make 
beautiful  this  life. 

The  unrest  of  the  wage  earners  has  been  augmented  by  re- 
cent changes  and  developments  in  industry.  Chief  of  these  are 
the  rapid  and  universal  introduction  and  extension  of  ma- 
chinery of  production,  by  which  unskilled  workers  may  be  sub- 
stituted for  the  skilled,  and  an  equally  rapid  development  of 
means  of  rapid  transportation  and  communication,  by  which 
private  capital  has  been  enabled  to  organize  in  great  corpora- 
tions possessing  enormous  economic  power.  This  tendency 
toward  huge  corporations  and  large  factories  has  been  fur- 
thered by  the  necessity  of  employing  large  sums  of  capital  in 
order  to  purchase  and  install  expensive  machinery,  the  use 
of  which  is  practicable  only  when  production  is  conducted  on  a 
large  scale.  Work  formerly  done  at  home  or  in  small  neigh- 
borhood shops,  has  been  transferred  to  great  factories  where 
the  individual  worker  becomes  an  impersonal  element  under 
the  control  of  impersonal  corporations,  without  voice  in  de- 
termining the  conditions  under  which  he  works,  and  largely 
without  interest  in  the  success  of  the  enterprise  or  the  dis- 
posal of  the  products.  Women  in  increasing  numbers  have 
followed  their  work  from  the  home  to  the  factory,  and  ?ven 
children  have  been  enlisted. 

Now,  more  than  ever,  the  profits  of  great  industries  under 


300 

centralized  control  pour  into  the  coffers  of  stockholders  and 
directors  who  never  have  so  much  as  visited  the  plants,  and 
who  perform  no  service  in  return.  And  while  vast  inherited 
fortunes,  representing  zero  in  social  service  to  the  credit  of 
their  possessors,  automatically  treble  and  multiply  in  volume, 
two-thirds  of  those  who  toil  from  eight  to  twelve  hours  a  day 
receive  less  than  enough  to  support  themselves  and  their  fam- 
ilies in  decency  and  comfort.  From  childhood  to  the  grave 
they  dwell  in  the  shadow  of  a  fear  that  their  only  resource — 
their  opportunity  to  toil — will  be  taken  from  them,  through  ac- 
cident, illness,  the  caprice  of  a  foreman,  or  the  fortunes  of 
industry.  The  lives  of  their  babies  are  snuffed  out  by  bad  air 
in  cheap  lodgings,  and  the  lack  of  nourishment  and  care  which 
they  can  not  buy.  Fathers  and  husbands  die  or  are  maimed 
in  accidents,  and  their  families  receive  a  pittance,  or  succumb 
in  mid-life  and  they  receive  nothing. 

And  when  these  unfortunates  seek,  by  the  only  means  within 
reach,  to  better  their  lot  by  organizing  to  lift  themselves  from 
helplessness  to  some  measure  of  collective  power,  with  which 
to  wring  living  wages  from  their  employers,  they  find  too  often 
arrayed  against  them  not  only  the  massed  power  of  capital, 
but  every  arm  of  the  Government  that  was  created  to  enforce 
guaranties  of  equality  and  justice. 

We  find  that  many  entire  communities  exist  under  the  arbi- 
trary economic  control  of  corporation  officials  charged  with 
the  management  of  an  industry  or  group  of  industries,  and 
we  find  that  in  such  communities  political  liberty  does  not 
exist,  and  its  forms  are  hollow  mockeries.  Give  to  the  em- 
ployer power  to  discharge  without  cause,  to  grant  to  or  with- 
hold from  thousands  the  opportunity  to  earn  bread,  and  the 
liberties  of  such  a  community  lie  in  the  hollow  of  the  em- 
ployer's hand.  Free  speech,  free  assembly,  and  a  free  press 
may  be  denied,  as  they  have  been  denied  time  and  again,  and 
the  employer's  agents  may  be  placed  in  public  office  to  do  his 
bidding. 

In  larger  communities  where  espionage  becomes  impossible, 
the  wage  earner  who  is  unsupported  by  a  collective  organiza- 


301 

tion  may  enjoy  freedom  of  expression  outside  the  workshop, 
but  there  his  freedom  ends.  And  it  is  a  freedom  more  ap- 
parent than  real.  For  the  house  he  lives  in,  the  food  he  eats, 
the  clothing  he  wears,  the  environment  of  his  wife  and  chil- 
dren, and  his  own  health  and  safety,  are  in  the  hands  of  the 
employer,  through  the  arbitrary  power  which  he  exercises  in 
fixing  his  wages  and  working  conditions. 

The  social  responsibility  for  these  unfortunate  conditions 
may  be  fixed  with  reasonable  certainty.  The  responsibility, 
and  such  blame  as  attaches  thereto,  can  not  be  held  to  rest 
upon  employers,  since  in  the  maintenance  of  the  evils  of  low 
wages,  long  hours  and  bad  factory  conditions,  and  in  their 
attempts  to  gain  control  of  economic  and  political  advantages 
which  would  promote  their  interests,  they  have  merely  fol- 
lowed the  natural  bent  of  men  involved  in  the  struggle  of 
competitive  industry.  The  responsibility  for  the  conditions 
which  have  been  described  above,  we  declare  rests  primarily 
upon  the  workers  who,  blind  to  their  collective  strength  and 
oftentimes  deaf  to  the  cries  of  their  fellows,  have  suffered  ex- 
ploitation and  the  invasion  of  their  most  sacred  rights  without 
resistance.  A  large  measure  of  responsibility  must,  however, 
attach  to  the  great  mass  of  citizens  who,  though  not  directly 
involved  in  the  struggle  between  capital  and  labor,  have  failed 
to  realize  that  their  own  prosperity  is  dependent  upon  the 
welfare  of  all  classes  of  the  community,  and  that  their  rights 
are  bound  up  with  the  rights  of  every  other  individual.  But, 
until  the  workers  themselves  realize  their  responsibility  and 
utilize  to  the  full  their  collective  power,  no  action,  whether 
Governmental  or  altruistic,  can  work  any  genuine  and  lasting 
improvement. 

Fourteen  years  before  Abraham  Lincoln  was  called  to  the 
high  omce  where  he  immortalized  his  name,  he  uttered  these 
great  truths: 

Inasmuch  as  most  good  things  are  produced  by  labor, 
it  follows  that  all  such  things  of  right  belong  to  those 
whose  labor  has  produced  them.  But  it  has  so  happened 
in  all  ages  of  the  world,  that  some  have  labored  and 


302 

others  have  without  labor  enjoyed  a  large  proportion  of 
the  fruits.  This  is  wrong  and  should  not  continue.  To 
secure  to  each  laborer  the  whole  product  of  his  labor,  or 
as  nearly  as  possible,  is  a  worthy  subject  of  any  good 
Government. 

With  this  lofty  ideal  for  a  goal,  under  the  sublime  leader- 
ship of  the  deathless  Lincoln,  we  call  upon  our  citizenship, 
regardless  of  politics  or  economic  conditions,  to  use  every 
means  of  agitation,  all  avenues  of  education,  and  every  de- 
partment and  function  of  the  Government,  to  eliminate  the  in- 
justices exposed  by  this  Commission,  t©  the  end  that  each 
laborer  may  " secure  the  whole  product  of  his  labor.' ' 

Frank  P.  Walsh. 


Note. — Chairman  Frank  P.  Walsh  also  presented  the  fol- 
lowing dissenting  opinion : 

Although  I  have  signed  the  report  prepared  by  Mr.  Basil 
M.  Manly,  Director  of  Research  and  Investigation,  because 
I  believe  it  represents  an  unassailable  statement  of  the  ex- 
isting industrial  situation,  because  it  fully  complies  with  the 
requirements  of  the  Act  of  Congress  creating  the  Commis- 
sion, and  because  the  recommendations  are  as  a  whole  wise 
and  necessary  for  the  welfare  of  the  Nation,  I,  neverthe- 
less, desire  to  record  my  dissent  on  the  following  points — 

1.  The  recommendation  for  new  administrative  machin- 
ery for  mediation  and  arbitration  in  the  form  of  a  special 
Commission.  I  believe  that  the  Commission  created  by  the 
Newlands  Act,  and  the  Department  of  Labor,  if  their  powers 
are  enlarged  and  they  are  adequately  supported,  will  be  fully 
able  to  deal  with  the  situation. 

2.  The  recommendations  for  a  literacy  test  as  a  method 
of  restricting  immigration.  I  wish  to  record  my  opposition, 
as  a  matter  of  principle,  to  all  restrictions  upon  immigration. 


303 

3.  The  recommendations  regarding  civil  government  in 
such  isolated  communities  as  coal  camps,  which  I  believe  can 
not  be  adequately  dealt  with  except  by  the  Government  taking 
over  all  coal  lands  and  leasing  them  upon  terms  which  will 
make  possible  their  operation  upon  a  cooperative  basis  by  the 
workers. 

Notwithstanding  many  meritorious  statements  contained 
in  the  report  of  Commissioners  John  R.  Commons  and  Flor- 
ence J.  Harriman,  I  feel  it  my  duty  to  dissent  from  the  same 
in  toto,  for  the  reasons  following: 

1.  It  wholly  fails  to  comply  with  the  law  creating  the  Com- 
mission, in  that  it  does  not  set  forth  the  facts  regarding  the 
condition  of  labor  in  the  leading  industries  of  the  United 
States  and  the  underlying  causes  of  industrial  dissatisfaction. 

2.  The  whole  scheme  of  the  control  of  labor,  and  the  laws 
governing  the  same,  is  undemocratic  and  not  in  accord  with  the 
established  principles  of  representative  government. 

3.  The  entire  plan  suggested  is  opposed  to  the  habits,  cus- 
toms and  traditions  of  the  American  people. 

4.  The  suggestions  in  the  main  are  impractical  and  impos- 
sible of  performance. 

5.  It  opens  up  unlimited  opportunities  for  graft  and  cor- 
ruption. 

6.  If  the  ponderous  legal  machinery  provided  for  in  this  re- 
port could  be  put  in  operation  throughout  our  Nation,  it  would 
mean — (a)  that  the  economic  condition  of  the  workers  of  the 
country  would  be  absolutely  subjected  to  the  whim  or  caprice 
of  an  army  of  officials,  deputies  and  Government  employees, 
and  (b)  the  establishment  of  an  autocratic  control  over  the 
business  operations  of  manufacturers,  merchants  and  other 
employers,  repugnant  to  American  standards  of  freedom  in 
manufacture  and  commerce. 


Report  of  Commissioners  John  R.  Commons 
and  Florence  J.  Harriman 


307 


REPORT  OP  COMMISSIONERS  JOHN  R.  COMMONS 
AND  FLORENCE  J.  HARRIMAN. 

ENACTMENT,    INTERPRETATION    AND    ENFORCE- 
MENT OF  LABOR  LAW. 

We  can  not  find  ourselves  able  to  agree  to  any  of  the  find- 
ings or  recommendations  of  the  staff  or  any  resolutions  based 
upon  them,  because  they  have  not  the  criticism  of  employers, 
employees  and  others  affected  by  them,  which  we  consider  in- 
dispensable in  order  that  we  might  have  before  us  assurance 
that  they  were  accurate  and  not  chargeable  with  important 
omissions.  These  reasons  are  stated  more  fully  in  paragraph 
4  following,  and  are  equally  appropriate  for  those  who  refuse 
to  sign  this  report.  We  find  ourselves  unable  to  agree  with 
other  recommendations  and  resolutions  for  legislation  because 
they  contain  few  or  no  practicable  suggestions  for  legislation 
that  would  be  enforceable,  or  because  they  are  directed  to  mak- 
ing a  few  individuals  scapegoats  where  what  is  needed  is 
serious  attention  to  the  system  that  produces  the  demand  for 
scapegoats,  and,  with  it,  the  breakdown  of  labor  legislation 
in  this  country.  In  this  way  we  interpret  the  act  of  Congress 
which  requires  us  to  inquire  "into  the  scope,  methods  and  re- 
sources of  existing  bureaus  of  labor  and  into  possible  ways 
of  increasing  their  usefulness."  From  our  personal  experi- 
ence we  agree  with  many  of  the  alleged  findings  and  with  the 
objects  intended  to  be  accomplished  by  the  enactment  of  pro- 
posed laws,  but  we  consider  that  it  is  not  worth  while  to  pro- 
pose any  more  laws  until  we  have  provided  methods  of  investi- 
gation, legislation  and  administration  which  can  make  laws  en- 
forceable. A  law  is  really  a  law  only  to  the  extent  that  it  is 
enforced,  and  our  statute  books  are  encumbered  by  laws  that 
are  conflicting,  ambiguous,  and  unenforceable,  or  partly  en- 
forced. Here  is  probably  the  greatest  cause  of  industrial  un- 
rest, for,  as  soon  as  people  lose  confidence  in  the  making  of 
laws  by  the  legislature,  in  their  interpretation  by  the  courts 
and  in  their  administration  by  officials,  they  take  the  law  into 
their  own  hands.    This  is  now  being  done  by  both  employers 


308 

and  employees.  Before  recommending  any  additional  much 
needed  laws  affecting  wages,  hours,  child  and  woman  labor, 
unemployment,  or  other  substantive  laws  to  improve  industrial 
conditions,  we  must  call  attention  to  the  widespread  break- 
down of  existing  laws  and  must  devise  methods  of  revising 
them  and  enacting  and  enforcing  new  laws  so  that  they  will  fit 
actual  conditions  and  be  enforceable  and  enforced.  With 
the  widespread  demand  for  more  laws  to  remedy  widespread 
and  well  recognized  causes  of  industrial  unrest,  there  is  a 
curious  feeling  that,  if  only  more  laws  are  placed  on  the  stat- 
ute books,  they  will,  in  some  unexplained  way,  get  themselves 
enforced.  While  recognizing  the  justice  of  much  of  this  de- 
mand for  new  laws  we  are  not  placing  them  first  in  our  report 
but  rather  the  methods  of  investigating  conditions,  of  enacting 
legislation,  of  judicial  interpretation  and  administrative  en- 
forcement necessary  to  make  them  worth  while  as  a  real 
remedy. 

Other  industrial  nations  have  gone  far  ahead  of  the  United 
States  in  adopting  labor  legislation,  much  of  which  is  also 
needed  here,  but  their  laws  are  drawn  up  so  as  to  be  enforce- 
able, and  their  machinery  of  enforcement  is  such  that  the 
people  are  willing  to  entrust  new  laws  to  their  officials  for 
enforcement.  Our  Government  is  different  from  theirs  and 
requires  different  methods,  but,  if  our  methods  and  official! 
can  not  be  made  as  effective  and  trustworthy  as  theirs,  then 
we  can  not  trust  more  laws  than  we  now  have  to  their  hands. 

One  of  the  most  important  facts  to  be  recognized  is  that 
governments,  whether  State  or  Federal,  can  not  be  looked  to 
alone  for  remedying  evil  conditions.  As  soon  as  people  come 
to  look  upon  the  coercive  power  of  government  as  the  only 
means  of  remedying  abuses,  then  the  struggle  for  control  of 
government  is  substituted  for  the  private  initiative  through 
private  associations  from  which  the  real  substantial  improve- 
ments must  come.  We  must  look  for  the  greatest  improve- 
ment to  come  through  the  cooperation  with  government  of  the 
many  voluntary  organizations  that  have  sprung  up  to  promote 
their  own  private  interests.    The  most  important  ones,  for  our 


309 

purposes,  are  employers'  associations,  labor  unions,  and  farm- 
ers '  organizations.  These  are  directly  affected  by  most  labor 
legislation,  and  they  have  much  more  powerful  influence  than 
have  unorganized  interests  upon  legislatures  and  administra- 
tive oflicials. 

Furthermore,  the  struggle  between  capital  and  labor  must 
be  looked  upon,  so  far  as  we  can  now  see,  as  a  permanent 
struggle  no  matter  what  legislation  is  adopted.  If  this  is  not 
recognized,  proposed  remedies  will  miss  the  actual  facts.  But 
there  are  certain  points  where  the  interests  of  capital  and 
labor  are  harmonious,  or  can  be  made  more  harmonious.  In 
fact,  this  field  where  there  is  no  real  conflict  between  employ- 
ers and  employees  is  much  wider  than  at  first  might  be  imag- 
ined. By  recognizing  these  two  facts  of  permanent  opposition 
and  progressive  cooperation,  it  may  be  possible  to  devise 
methods  of  legislation,  court  interpretation  and  administra- 
tion which  will  reduce  antagonism  and  promote  cooperation. 
For,  while  we  can  not  look  to  government  alone  for  remedying 
abuses,  it  is  only  by  legislation  that  we  can  give  voluntary 
organizations  a  greater  share  in  working  out  their  own  reme- 
dies and  in  cooperating  with  government  toward  increasing 
the  points  of  harmony. 

Some  progress  has  been  made  in  this  direction  in  the  past 
few  years  in  some  States,  through  the  enactment  of  laws  cre- 
ating industrial  commissions,  but  none  of  these  laws  go  to 
the  full  extent  required  in  order  to  carry,  out  the  foregoing 
principles.  By  observing  the  strong  and  weak  points  of 
these  laws,  as  well  as  those  of  other  States  and  the  Federal 
Government  which  have  not  adopted  similar  laws,  we  can 
draw  certain  conclusions  which  we  do  in  the  form  of  rec- 
ommendations. A  draft  of  a  bill  embodying  most  of  these 
recommendations,  was  submitted  to  the  legislatures  of  Colo- 
rado and  New  York  during  the  legislative  sessions  of  1915 
and  was  adopted  with  more  or  less  serious  modifications  and 
additions  by  those  legislatures.  The  recommendations  below 
contain  most  of  the  terms  of  the  foregoing  draft  and  also  of 
improvements  which  seem  essential  to  be  made  in  the  indus- 


310 

trial  commission  laws  of  the  States,  and  of  proposed  laws  for 
State  or  Federal  Governments.  Some  of  the  recommenda- 
tions are  based  on  personal  experience  in  the  administration 
of  labor  laws. 


INDUSTRIAL    COMMISSIONS. 

1.  State  and  Federal  Industrial  Commissions  to  be  created 
for  the  administration  of  all  labor  laws.  All  bureaus  or  divi- 
sions dealing  with  conditions  of  labor,  including  industrial 
safety  and  sanitation,  workmen's  compensation,  employment 
offices,  child  labor,  industrial  education,  statistics,  immigra- 
tion, and  so  on,  to  be  placed  under  the  direction  of  the  com- 
mission. Each  commission  to  consist  of  three  commissioners 
to  be  appointed  by  the  Governor  or  President,  as  the  case  may 
except  that  the  terms  of  the  commissioners  first  appointed 
with  the  advice  of  the  advisory  representative  council.  (See 
Paragraph  2.)  The  term  of  each  commissioner  to  be  six  years, 
except  that  the  terms  of  the  commissioners  first  appointed 
shall  be  so  arranged  that  no  two  shall  expire  at  the  same 
time.  The  Federal  Department  of  Labor  to  be  retained  for 
educational  and  political  purposes  and  a  similar  department 
might  be  created  in  large  industrial  States,  such  as  New 
York  and  Pennsylvania. 

The  tendency  of  labor  legislation  in  the  States  which  have 
given  attention  to  this  matter  has  been  toward  a  complete  cen- 
tralization of  the  administration  of  the  labor  laws  in  the  hands 
of  a  single  department  Wisconsin  in  1911  established  an  indus- 
trial commission  for  the  administration  of  all  labor  laws,  and 
Ohio,  after  one  year  of  separate  administration  of  the  com- 
pensation law,  created  in  1913,  a  similar  commission,  and  in- 
corporated the  compensation  commission  into  an  industrial 
commission.  In  New  York  and  Pennsylvania  the  responsibil 
ity  for  the  administration  of  labor  laws  had  been  divided  be- 
tween a  commissioner  of  labor,  who  is  responsible  for  their  en- 


311 

forcement,  and  an  industrial  board  of  five  members  the 
sole  duty  of  which  is  to  make  necessary  rules  and  regulations 
having  the  force  of  law.  Tn  New  York  there  has  also  been  a 
separate  commission  for  the  administration  of  the  compensa- 
tion act.  The  tendency,  however,  is  strongly  toward  the  in- 
dustrial commission  plan,  as  the  New  York  plan,  which  was 
devised  at  the  time  of  the  reorganization  of  the  labor  de- 
partment of  that  State  in  1913  and  adopted  in  the  same  year 
by  Pennsylvania  in  an  act  largely  copied  from  the  New  York 
law,  has  already  (1915)  been  given  up  in  the  State  of  its 
origin.  The  New  York  commission  under  the  law  of  1915 
consists  of  five  members  and  is  charged  with  the  administra- 
tion of  all  labor  laws  and  the  workmen's  compensation  law, 
and  also  with  the  duty  of  making  the  rules  and  regulations  for 
carrying  these  laws  into  effect.  In  Pennsylvania  a  compensa- 
tion act  has  this  year  (1915)  been  enacted,  and,  while  no 
change  has  been  made  in  the  organization  of  the  labor  depart- 
ment, the  administration  of  the  compensation  act  has  been  en- 
trusted to  that  department. 

During  the  present  year  (1915)  at  least  five  States  have 
enacted  legislation  for  a  closer  union  of  the  administration 
of  their  labor  and  compensation  laws.  Colorado,  with  serious 
modifications,  and  Indiana,  have  enacted  laws  creating  in- 
dustrial commissions  similar  to  those  of  Wisconsin  and  Ohio. 
Nevada  has  created  an  industrial  commission  of  three  mem- 
bers for  the  administration  of  its  compensation  act  and  has 
conferred  upon  one  of  the  commissioners,  to  be  designated  as 
commissioner  of  labor,  the  duty  of  enforcing  all  laws  of  the 
State  for  the  protection  of  the  working  classes.  In  New 
Jersey,  after  an  unsuccessful  attempt  to  create  an  industrial 
commission,  provision  has  been  made  for  two  additional  em- 
ployees in  the  department  of  labor  for  the  purpose  of  cor- 
relating the  work  of  that  department  with  the  administration 
of  the  compensation  act. 

In  California  the  industrial  accident  commission  adminis- 
ters the  compensation  act  and  also  laws  dealing  with  safety  in 
places  of  employment,  although  the  labor  bureau  also  has  the 


312 

latter  authority;  and  in  Massachusetts,  while  there  are  still 
separate  boards  in  charge  of  the  labor  department  and  of  the 
administration  of  the  compensation  law,  the  two  boards  sit 
jointly  for  the  purpose  of  making  rules  and  regulations  for  the 
prevention  of  industrial  accidents  and  occupational  diseases. 

In  several  States  bills  have  been  introduced  for  the  creation 
of  an  industrial  commission  for  the  administration  of  all  such 
laws.  In  New  Jersey  such  a  bill  was  introduced  by  the  Presi- 
dent of  the  State  Federation  of  Labor,  who  is  also  a  member 
of  the  Assembly,  and  in  Marj-land  such  a  bill  was  prepared 
and  introduced  at  the  instance  of  the  State  labor  department. 
In  Illinois  the  report  of  the  efficiency  and  economy  committee 
recommended  the  consolidation  of  the  various  departments 
dealing  with  labor  laws,  including  the  board  administering  the 
compensation  act,  and  in  Missouri  a  legislative  committee, 
after  a  careful  study  of  the  subject,  reported  in  December, 
1914,  in  favor  of  the  enactment  of  a  compensation  law  and  the 
creation  of  an  industrial  commission  to  administer  both  it  and 
the  other  labor  laws  of  the  State.  This  latter  report  is  par- 
ticularly important  because  it  represents  the  result  of  a 
recent  official  study  of  the  problem  and  consideration  of  the 
experience  of  the  States  which  have  advanced  labor  laws. 

As  already  explained,  the  fundamental  principle  of  these 
recommendations  is  that  the  administration  of  all  the  labor 
laws  of  a  State  shall  be  centralized.  An  illustration  of  the  ad- 
vantages is  found  in  uniting  the  administration  of  the  labor 
laws  relating  to  safe  and  sanitary  conditions  of  employment 
with  the  administration  of  the  workmen's  compensation  laws. 

It  is  probably  unnecessary  at  this  stage  of  the  development 
of  workmen's  compensation  legislation  to  consider  the  question 
whether  there  should  be  a  responsible  officer  or  officers  charged 
with  the  administration  of  such  laws,  or  whether  their  ad- 
ministration should  be  left  to  individual  initiative  and  the  final 
determination  of  courts  of  law,  already  burdened  with  many 
other  and  equally  important  responsibilities.  That  question 
is  settled  and  the  only  point  is  as  to  the  character  of  the  admin- 
istrative agency.    Both  the  nature  of  the  compensation  laws 


313 

and  the  experience  which  has  been  gained  during  their  opera- 
tion in  many  States  point  to  a  board  or  commission,  instead  of 
the  courts,  as  the  best  form  of  administration.  Economy  of 
administration  then  is  secured  if  the  administration  of  safety 
laws  is  placed  in  the  hands  of  the  compensation  commission. 
Fewer  highly  paid  executive  officers  and  other  employees  are 
required,  and  there  is  secured  avoidance  of  duplication  in  the 
work  itself.  For  example,  it  is  essential  to  the  administration 
of  both  these  laws  that  employers  should  be  required  to  make 
reports  of  accidents.  On  the  one  hand  they  furnish  necessary 
information  respecting  the  nature  of  accidents  and  the  possi- 
bilities of  prevention;  on  the  other,  they  are  necessary  in  the 
actuarial  work  involved  in  the  administration  of  compensation. 
The  same  is  true  of  the  inspections  which  are  frequently  neces- 
sary in  the  course  of  the  administration  of  both  laws  and  in 
most  instances  one  inspection  would  serve  both  purposes. 
Furthermore,  the  information  derived  from  hearings  in  com- 
pensation is  of  great  assistance  to  the  commissioners  who  are 
also  charged  with  responsibility  of  the  labor  laws  generally  in 
giving  them  a  broader  view  of  the  problems  with  which  they 
are  dealing. 

The  same  kind  of  events  that  have  led  up  to  the  State  indus- 
trial commission  are  taking  place  in  Federal  legislation.  Al- 
ready two  bills  on  workmen's  compensation  have  been  well  ad- 
vanced and  one  of  them  creates  a  commission  separate  from 
the  Department  of  Labor.  The  bill  for  compensation  of  em- 
ployees of  the  Government  (63d  Cong.  2d  Sess.  H.  K.  15222) 
takes  the  place  of  the  present  law  administered  by  the  Depart- 
ment of  Labor,  and  provides  for  a  " United  States  Employees' 
Compensation  Commission"  consisting  of  three  commission- 
ers, no  one  of  whom  shall  hold  any  other  Federal  office  or  posi- 
tion. The  other  (63d  Cong.,  1st  Sess.,  S.  959)  providing  for 
employees  of  private  employers  in  interstate  commerce,  leaves 
the  administration  of  the  law  to  the  courts,  a  method  that  has 
been  effectually  discredited.  Whether  either  or  both  bills  on 
workmen's  compensation  are  adopted,  they  should  be  united, 
as  already  shown  in  the  case  of  the  States,  under  a  commission 
that  administers  the  safety  laws. 


314 

When  the  Department  of  Labor  was  created  the  important 
work  of  safety  for  mine  workers  was  left  in  the  Department 
of  Interior  under  the  Bureau  of  Mines.  Safety  on  railroads 
is  in  the  hands  of  the  Interstate  Commerce  Commission.  The 
Bureau  of  Standards,  of  the  Department  of  Commerce,  de- 
velops safety  standards  for  electric  and  other  equipment.  The 
Public  Health  Service,  of  the  Treasury  Department,  in- 
vestigates industrial  diseases  and  factory  sanitation.  The 
Bureau  of  Labor  Statistics,  of  the  Department  of  Labor,  in- 
vestigates and  publishes  bulletins  on  accidents  and  diseases  in 
various  industries.  Lately  a  bill  has  passed  the  House  pro- 
viding for  a  safety  bureau  in  the  Department  of  Labor,  with 
power  to  investigate  any  or  all  of  the  matters  of  safety  now 
carried  on  either  in  that  Department  or  in  any  other  depart- 
ment. The  Seamen's  Law  recently  enacted  is  in  the  hands  of 
the  Department  of  Commerce,  assisted  by  the  Department  of 
Labor.  The  Department  of  Agriculture  has  a  division  on  rural 
housing  and  social  conditions. 

This  overlapping  of  jurisdiction  in  matters  of  industrial 
safety  and  sanitation  has  grown  up  without  any  plan,  accord- 
ing to  the  accident  of  such  officials  as  happened  to  be  on  the 
ground  or  to  get  a  hearing  in  Congress ;  or  on  account  of  ob- 
jection to  placing  authority  in  one  department  or  another. 
And  now,  with  the  prospect  of  Federal  legislation  for  compen- 
sation for  accidents  and  occupational  diseases,  one  or  two  more 
bureaus  are  likely  to  be  created,  with  their  most  important  ob- 
ject the  prevention  of  accidents. 

At  the  same  time  three  great  private  associations  have 
sprung  up  which  are  doing  as  much  or  more  for  safety  than 
all  the  State  and  Federal  Governments  combined.  The  Con- 
ference Board  of  National  Allied  Safety  Organizations,  com- 
posed of  representatives  from  the  National  Association  of 
Manufacturers,  the  National  Founders'  Association,  the  Na- 
tional Metal  Trades  Association,  and  the  National  Electric 
Light  Association,  has  begun  the  standardization  of  safety  de- 
vices for  millions  of  employees,  regardless  of  any  standards 
which  State  or  Government  officials  may  set  up. 


315 

The  National  Council  of  Safety,  composed  of  the  safety  ex- 
perts of  most  of  the  large  corporations  of  the  country,  and  of 
representatives  of  labor,  has  developed  an  extensive  campaign 
of  accident  prevention.  The  Workmen's  Compensation  Serv- 
ice Bureau,  supported  by  the  liability  insurance  companies, 
is  doing  expert  work  of  the  highest  order  in  safety  devices 
and  processes  for  the  assistance  of  such  employers  as  are 
policy  holders  in  those  companies. 

With  these  three  national  organizations  representing  the 
employing  interests,  with  ut  least  five,  and  the  prospect  of 
seven,  bureaus  representing  the  Federal  Government,  and  with 
similar  agencies  more  or  less  developed  in  the  States,  all  of 
them  working  on  the  same  problem  of  compensation  for  acci- 
dents and  prevention  of  accidents,  the  time  is  ripening  for 
some  kind  of  correlation  and  uniformity.  It  can  not  be  ex- 
pected that  Congress  and  the  people  will  long  be  satisfied  with 
this  expensive  and  wasteful  disorganization  of  the  national 
energies  that  are  directed  to  the  great  work  of  safety  and  com- 
pensation. Just  as  the  States  are  moving  towards  centraliza- 
tion under  industrial  commissions,  so  the  same  problem  must 
force  the  Federal  Government  toward,  not  only  centralization 
of  its  own  work,  but  correlation  with  the  States  and  with  pri- 
vate organizations. 

It  does  not  follow  that  all  of  the  Federal  bureaus  dealing 
with  safety  and  health  should  be  bodily  taken  from  their  sev- 
eral departments  and  transferred  to  an  Industrial  Commis- 
sion. There  may  be  cases  where  their  work  on  industrial  safe- 
ty and  health  is  tied  up  with  their  other  work.  It  is  only 
necessary  that  the  several  departments  should  be  required  by 
law  to  discontinue  any  overlapping  or  conflict  of  jurisdiction, 
and  that  an  industrial  commission  should  have  authority  to 
bring  them  all  together  into  a  National  Council  of  Industrial 
Safety  and  Health,  and  require  them  to  agree  on  a  definite 
plan  of  dividing  up  the  work  and  cooperating  with  each  other 
and  with  private  associations  organized  for  similar  work. 
Other  comments  will  be  found  under  Paragraph  3. 


316 


ADVISORY  REPRESENTATIVE  COUNCIL. 

2.  An  advisory  Representative  Council  consisting  of  the 
Secretary  of  Commerce  and  the  Secretary  of  Labor,  and  of 
say  ten  employers  (including  farmers)  and  ten  representatives 
of  labor  unions  (including  women).  The  representatives  on 
the  Council  to  be  selected  from  lists,  not  including  lawyers, 
submitted  by  recognized  employers'  associations  in  the  State 
or  in  the  Nation,  as  the  case  may  be;  such,  for  example,  as 
state  associations  of  manufacturers,  the  National  Metal 
Trades  Association,  the  National  Founders'  Association,  as- 
sociations of  coal  operators,  of  railroad  presidents,  of  brew- 
ers, of  farmers'  organizations,  etc.  The  representatives  of 
employees  to  be  selected  from  lists  submitted  by  the  American 
Federation  of  Labor,  the  railroad  brotherhoods,  the  Women 's 
Trade  Union  League,  and  independent  organizations.  In  all 
cases  either  the  associations  entitled  to  representation  should 
be  named  in  the  law  or  provision  should  be  made  whereby  the 
Governor  or  President,  upon  investigation,  shall  name  organi- 
zations which  are  considered  representative  by  organized  em- 
ployers and  organized  employees  themselves,  and  permit  them 
to  name  their  representatives.  Similar  provision  in  case  an 
organization  ceases  to  exist  or  to  be  representative.  Any  or- 
ganization entitled  to  recall  its  representative  on  notice.  The 
Representative  Council  to  be  appointed  by  the  Governor  or 
the  President  before  the  appointment  of  the  Commission,  and 
the  Governor  or  the  President  to  call  it  together  and  to  con- 
sult with  it  regarding  the  names  proposed  to  be  nominated 
for  Commissioners.  The  Industrial  Commission  to  invite  also 
a  limited  number,  say  ten,  of  individuals  or  representatives  of 
organizations  including  persons  especially  interested  in  un- 
organized labor,  and  representatives  of  such  organizations  as 
the  International  Association  for  Labor  Legislation,  the  Na- 


317 

tional  Child  Labor  Committee,  and  the  Consumers'  League, 
and  individual  employers  and  employees,  as  may  be  advisable 
for  their  assistance,  to  be  members  of  the  Advisory  Council. 
The  Council  to  take  no  vote  on  any  subject  except  procedure, 
and  to  have  no  veto  on  any  act  of  the  Industrial  Commission. 
Nominal  compensation  or  no  compensation  to  members,  with 
necessary  expenses.  The  Representative  Council  to  effect  its 
own  organization  and  call  meetings  independent  of  the  Com- 
mission, to  be  provided  with  a  secretary  and  needed  clerical 
assistance,  to  hold  meetings  perhaps  quarterly  and  on  call,  to 
keep  and  publish  records  of  its  proceedings.  The  Industrial 
Commission  to  be  required  to  submit  all  proposed  rules,  regu- 
lations and  publications  to  the  Representative  Council,  allow- 
ing sufficient  time  for  examination  and  discussion,  and  to  pub- 
lish any  protest  or  criticism  filed  by  any  member  of  the  Coun- 
cil, along  with  the  Commission's  own  publication. 

This  recommendation  is  an  extension  of  a  principle  which  is 
left  optional  in  several  State  commission  laws,  but  the  manda- 
tory feature  has  been  partially  adopted  by  law  in  New  York. 
The  recommendation  creates  a  body  similar  to  the  Superior 
Councils  of  Labor  in  France,  Belgium  and  Italy,  the  Industrial 
Council  in  England,  and  many  councils  of  private  representa- 
tive citizens  who  assist  government  officials  in  Germany.  In 
Wisconsin  the  appointment  of  a  council  is  optional  with  the 
commission,  but  it  has  been  appointed  for  several  purposes 
and  this  policy  has  been  demonstrated  to  be  the  most  effective 
of  all  that  the  commission  has  adopted.  The  omission  by  that 
commission  to  adopt  it  at  times  has  been  a  source  of  severe 
and  just  criticism,  and  accounts  for  the  granting  of  permits 
against  which  objections  are  rightly  made.  In  New  York  the 
Representative  Council  is  mandatory,  but  the  selections  are 
made  by  the  Governor,  and  are  therefore  liable  to  be  political 
and  nonrepresentative.  For  these  reasons  it  is  recommended 
that  the  Council  not  only  be  mandatory,  as  in  New  York,  but 
that  no  action  of  the  Commission,  except  in  case  of  specified 


318 

emergencies,  shall  be  valid,  and  no  publication  shall  be  issued, 
unless  previously  submitted  to  the  Representative  Council.  In 
this  respect  the  Advisory  Representative  Council  would  have 
powers  in  excess  of  those  of  similar  councils,  except  perhaps 
the  Superior  Council  of  Belgium. 

Appointment  by  the  Governor,  President,  or  Industrial  Com- 
mission is  required  in  order  that  members  may  receive  neces- 
sary expenses.  Lawyers  are  excluded  because  the  Council 
should  be  composed  of  persons  with  practical  experience  in 
industry. 

The  history  of  Governmental  commissions  and  departments 
has  often  been  the  appointment  of  men  on  the  recommendation 
of  politicians  or  special  interests  or  the  accident  of  personal 
acquaintance.  An  executive,  in  looking  around  for  competent 
appointees,  is  often  at  a  disadvantage,  because  he  can  not  get 
impartial  and  disinterested  men  to  accept,  or  because  he  does 
not  have  impartial  and  competent  advice  in  his  selections.  To 
the  proposed  Industrial  Commissions  is  given  the  most  serious 
problem  before  the  American  people.  Almost  everything  turns 
on  the  kind  of  men  appointed.  They  must  be  men  not  only 
competent  but  having  the  respect  of  the  great  opposing  in- 
terests. Their  position  is  that  of  a  kind  of  mediator  as  well 
as  of  administrator.  Such  appointments  should  not  be  made 
in  haste,  nor  in  the  secret  of  the  executive's  accidental  advis- 
ors. They  should  be  considered  publicly,  and  especially  by  the 
opposing  interests  whose  fortunes  will  be  committed  in  great 
part  to  their  hands.  The  Governor  or  President  can  not,  of 
course,  be  bound  by  the  action  of  the  Council,  but  he  can  be  re- 
quired to  get  their  advice  on  names  proposed. 

It  is  intended  that  the  members  of  the  Commission  itself 
should  not  be  representative  of  either  employers  or  employees, 
but  that  they  should  have  the  confidence  of  both  sides.  This 
is  expected  to  follow  from  the  requirement  that  the  Governor 
or  President  should  consult  the  Council  before  making  his 
nominations  of  Commissioners.  In  this  way,  what  is  known 
as  "the  public"  would  be  represented  in  part  by  the  Commis- 


319 

sion,  while  capital  and  labor  would  be  represented  in  the  Coun- 
cil. 

By  this  method  it  can  be  expected  that  capable  men  may  be 
attracted  from  their  private  occupations  into  public  service 
as  members  of  the  Commission.  Usually,  the  kind  of  men  re- 
quired for  such  positions  dread  the  political  and  personal  at- 
tacks that  are  connected  with  public  office.  But  it  would  be 
difficult  for  an  eminent  man  to  resist  the  call  to  public  office 
when  he  has  the  united  invitation  of  the  President,  the  em- 
ployers and  the  labor  unions  of  the  country. 

The  Representative  Council  has  no  veto  power,  but  is  in- 
tended merely  as  a  cooperative  body  representing  employers, 
employees,  the  public  as  it  is  represented  by  the  Secretaries  of 
Commerce  and  Labor,  and  individuals  selected  by  the  Commis- 
sion. Its  duties  are  purely  advisory.  Its  purpose  is  not  only 
to  give  the  Governor  or  President  and  the  Commission  the 
benefit  of  advice  and  to  bring  together  for  conference  repre- 
sentative labor  men  and  employees,  but  to  guarantee  as  far  as 
possible  that  all  appointments  (Paragraph  3),  all  investiga- 
tions and  publications  (Paragraph  4),  all  rules  and  regulations 
(Paragraph  5),  and  other  acts  of  the  Commission,  shall,  before 
they  are  published  or  become  valid,  be  under  the  continuous 
supervision  of  the  recognized  leaders  of  organized  capital  and 
organized  labor,  and  public  representatives. 

No  requirement  is  made  for  the  appointment  of  advisory  ex- 
perts, such  as  lawyers,  engineers  and  physicians.  These  may 
be  appointed  by  the  Industrial  Commission  as  members  of  the 
third  interest  on  the  Council,  but  it  is  found  in  practice  that 
the  services  of  consulting  experts  are  secured  without  expense 
to  the  State  if  representative  employers  and  employees  have 
a  part  in  the  Advisory  Council.  This  is  attended  to  because 
the  employer  and  employee  representatives  themselves  have 
not  the  technical  knowledge  and  can  not  give  the  time  necessary 
to  consider  all  details,  but  must  consult  experts  in  whom  they 
have  confidence.  This  they  do,  and  are  thereby  prepared  to 
discuss  intelligently  the  acts  of  the  Commission.  The  Council 
and  the  Commission  can,  of  course,  call  in  such  experts  to 
their  conferences  at  any  time. 


320 

The  employer  and  employee  members  of  the  Advisory  Coun- 
cil should  be  strictly  representative  and  responsible  to  the 
organizations  represented.  For  this  reason  the  organizations 
and  not  the  Government  should  pay  the  salaries  of  the  mem- 
bers. The  result  as  shown  in  Wisconsin,  where  not  even  ex- 
penses are  paid,  is  that  the  representatives  are  usually  busi- 
ness agents  of  the  unions  and  large  employers  selected  by  the 
employers'  associations. 

The  Council  should  organize  with  its  own  officers,  independ- 
ent of  the  Commission,  but  should  hold  its  conferences  with 
members  of  the  Commission  or  with  members  of  the  staff. 
It  should  appoint  expert  advisory  committees  as  needed  for 
different  subjects,  such  as  safety,  employment  offices,  etc. 
It  should  be  provided  with  clerical  and  other  help  from  the 
staff  of  the  Commission. 

Since  the  powers  of  the  Council  are  only  advisory  it  is  not 
essential  that  it  should  vote  on  any  questions  except  proce- 
dure. Hence  it  is  not  necessary  to  have  equal  representation 
of  any  interests  or  full  attendance  at  all  meetings.  Each  mem- 
ber should  be  furnished  by  mail  with  all  proposals  and  pro- 
posed publications  of  the  Industrial  Commission. 

For  the  reasons  just  cited,  it  is  not  necessary  that  the  Com- 
mission itself  should  consist  of  more  than  three  members. 
They  are  not  expected  in  the  larger  States  or  in  the  Federal 
Government  to  attend  to  details  of  administration.  Their 
duties  will  be  mainly  those  of  consultation  and  conferences 
with  the  council,  supervision  of  the  executive  heads  of  divi- 
sions (Paragraph  3),  and  public  hearings. 

This  Advisory  Council  provides  effective  publicity  for  every 
act  of  the  Commission.  The  ordinary  publicity  required  by 
law  is  that  of  a  public  hearing  and  is  limited  to  rules  and  regu- 
lations which  are  to  have  the  effect  of  law.  Such  public  hear- 
ings have  become  mere  legal  formalities,  at  which  usually  law- 
yers appear  for  each  side  and  little  or  no  opportunity  is  given 
for  the  two  sides  to  get  together  on  points  where  they  can 
agree.  The  Commission  then  retires  and  issues  such  rules  and 
regulations  as  it  may  choose.    These  formal  public  hearings 


321 

are  not  even  required  by  law  in  some  cases,  but  (Paragraph 
5)  the  recommendation  provides  that  before  the  public  hear- 
ing the  employers  and  employees,  with  the  Commission  and  its 
staff,  shall  have  considered  and  drafted  the  proposed  rules  so 
that  when  it  comes  to  the  public  hearing  they  are  present  to 
explain  and  defend  them.  If  objections  are  raised  at  the  pub- 
lic hearing  the  proposed  rules  are  referred  back  to  the  Ad- 
visory Council  and  the  staff  of  the  Commission  for  reconsid- 
eration before  being  finally  approved  and  issued  as  the  legal 
act  of  the  Commission.  If  no  public  hearing  is  required  by 
law,  rules  can  not  be  issued  except  on  advice  of  the  Representa- 
tive Council.  In  this  way  an  effective  publicity  is  secured  by 
a  thorough  consideration  of  the  rules,  because  both  those  who 
are  to  be  compelled  by  law  to  obey  the  rules  and  those  in  whose 
interest  they  are  issued,  have  assisted  in  drafting  them. 
Additional  comments  will  be  found  under  Paragraph  3. 


CIVIL   SERVICE  AND   COMMENTS   ON  PRECEDING 

PARAGRAPHS. 

3.  The  Commission  to  appoint  a  secretary,  bureau  chiefs  or 
chiefs  of  divisions,  and  such  other  employees  as  may  be  nec- 
essary, all  of  them  to  be  under  Civil  Service  Rules.  Provision 
to  be  made  for  the  Advisory  Representative  Council  or  a 
committee  named  by  it,  representing  both  employers  and  em- 
ployees, to  assist  the  Civil  Service  Commission  in  conducting 
examinations,  except  for  clerical  positions,  and  making  it  man- 
datory on  the  Civil  Service  Commission  to  appoint  these  rep- 
resentatives on  its  examining  boards.  Members  of  Advisory 
Council  while  serving  on  such  boards  to  receive  extra  com- 
pensation. If  there  is  no  Civil  Service  Commission  in  the 
State,  then  the  Advisory  Council  shall  cooperate  with  the  In- 
dustrial Commission  in  the  examinations.  The  Commission 
afterwards  to  make  its  appointments  from  the  eligible  list  of 
those  who  pass  the  examinations.   A  graded  system  of  salaries 


322 

and  promotions  to  be  adopted,  by  which  the  members  of  the 
staff  may  rise  to  the  position  of  heads  of  bureaus  or  divisions, 
where  they  would  receive  salaries  equivalent,  if  necessary, 
to  those  received  by  the  Commissioners.  Any  proposed  re- 
moval of  subordinates  to  be  brought  before  the  Advisory 
Council  before  action. 

Many  of  the  features  of  this  section  are  adopted  in  the  New 
York  Act,  but  the  examination  by  employers  and  employees 
is  not  mandatory  on  the  Civil  Service  Commission,  and  a  few 
of  the  chief  positions  are  exempt  from  Civil  Service  Rules. 
The  Civil  Service  and  Industrial  Commissions  of  Wisconsin 
have  practiced  this  method  of  examination  and  appointment 
for  employment  offices  and  for  chiefs  of  divisions,  although 
not  required  by  law. 

Objection  sometimes  is  made  to  Civil  Service  examinations 
as  being  impractical  and  theoretical.  Indeed,  Civil  Service 
examinations  are  likely  to  be  impractical  if  conducted  by  ex- 
perts. These  objections  can  be  avoided  in  the  examinations 
for  these  positions  by  requiring  that  the  Civil  Service  Commis- 
sion, if  there  is  one,  shall  cooperate  with  the  Representative 
Council.  The  examinations  would  thus  be  conducted  with  the 
aid  of  men  thoroughly  acquainted  with  all  the  practical  diffi- 
culties involved  in  the  duties  of  the  positions  to  be  filled.  By 
making  use  of  oral  or  written,  assembled  or  non-assembled, 
competitive  or  noncompetitive  examinations,  as  best  suited 
to  the  particular  purposes,  it  should  be  possible  to  obtain  all 
the  advantages  of  the  Civil  Service  System  with  few  of  its 
disadvantages. 

Furthermore,  it  is  not  enough  that  examinations  for  posi- 
tions under  the  Industrial  Commission  should  secure  efficiency 
and  permanency ;  it  is  even  more  important  that  they  should 
secure  impartiality.  The  Industrial  Commission  itself  and 
its  entire  staff  are  looked  upon  as  mediators  in  adjusting  the 
administration  of  labor  laws  to  the  actual  conditions  of  in- 
dustry. It  is  essential  that  both  sides  should  have  confidence 
in  the  staff  of  the  Commission,  and  therefore  that  both  sides 
should  have  a  voice  in  its  selection. 


323 

This  provision  for  representatives  of  employers  and  em- 
ployees on  examining  boards  should  not  be  left  optional  with 
Civil  Service  Commissions  or  the  Industrial  Commission,  but 
should  be  mandatory.  It  has  been  found  that  several  Civil 
Service  Commissions  object  to  this  provision,  because  they 
wish  to  retain  unqualified  authority  for  conducting  examina- 
tions and  making  up  eligible  lists.  This  is  one  of  the  features 
of  bureaucracy  which  should  not  be  permitted  where  such  vital 
issues  as  the  contest  between  capital  and  labor  are  at  stake. 
The  provision  in  the  recommendation  does  not  prevent  Civil 
Service  Commissions  from  appointing  experts  on  their  ex- 
amining boards;  it  merely  requires  them  also  to  appoint,  in 
addition,  the  recognized  representatives  of  the  interests  who 
have  previously  been  nominated  by  the  interests  themselves. 

At  the  present  time  secretaries  and  bureau  chiefs  in  the 
Federal  Government  are  exempt  from  Civil  Service  Rules, 
and  are  usually  appointed  by  the  President  and  confirmed  by 
the  Senate.  This  is  a  serious  discouragement  to  competent 
subordinates  who  are  thereby  prevented  from  rising  by  pro- 
motion to  the  higher  positions  in  their  bureaus,  and  who  see 
less  competent  political  appointees  brought  in  over  their  heads 
as  well  as  frequently  changed. 

These  recommendations  are  intended  to  place  the  highest 
positions  under  the  Industrial  Commissions  on  an  equivalent 
with  the  Commissioners  themselves.  It  would  be  unfortunate 
and  impracticable,  except  in  smaller  States,  if  the  Commis- 
sioners were  required  to  give  their  entire  time  to  the  details 
of  administration.  This  is  the  case  where  a  Commission 
must  perform  as  many  functions  as  are  required  in  the  large 
State  and  Federal  Government  Commissions.  This  they 
would  be  compelled  to  do  if  their  chiefs  of  divisions  were 
frequently  changed,  as  under  the  present  system.  The  chiefs 
of  divisions  and  bureaus,  both  under  Federal  and  under  State 
commissions,  should  be  as  competent  as  the  Commissioners 
to  deal  with  employers  and  employees,  and  much  more  com- 
petent in  dealing  with  subordinates.  In  foreign  countries  the 
oflfice  of  factory  inspector  as  well  as  all  other  offices  dealing 


324 

with  the  relations  of  employers  and  employees,  are  considered 
as  professions.  In  some  of  those  countries  the  universities 
provide  training  courses  and  lectures  on  the  subjects  for  which 
the  officials  are  preparing,  and  these  are  required  to  be  taken 
as  a  part  of  the  Civil  Service  Rules.  The  appointee  then 
serves  as  an  apprentice  in  the  department,  and  by  promotion 
may  reach  the  highest  position.  As  a  result  a  high  grade  of 
inspector  is  obtained.  Only  when  the  officers  and  employees 
of  the  commissions  have  such  opportunities  as  these  for  a 
life  work,  provided  they  are  impartial  as  between  employers 
and  employees,  can  officials  be  interested  in  preparing  them- 
selves for  the  work,  or  academies  like  those  at  West  Point  and 
Annapolis  be  adopted  for  the  training  of  civil  servants. 

The  Advisory  Representative  Council,  proposed  in  para- 
graph 2,  also  protects  the  administration  of  labor  laws  from 
the  just  fear  of  government  by  a  bureaucracy.  There  must  be 
officials  if  labor  laws  are  to  be  enforced.  The  courts  can  not  be 
relied  upon  alone,  because  prosecution  can  be  begun  only  by 
private  individuals.  Consequently  administrative  officers  and 
inspectors  have  been  provided  to  initiate  prosecutions.  These 
officials  constitute  a  necessary  bureaucracy,  if  the  laws  are 
enforced.  But  it  can  not  be  asserted  that  the  present  system 
of  political  appointments  of  inspectors  avoids  the  evil  of  bu- 
reaucracy. The  essential  evil  of  bureaucracy  is  not  so-called 
permanency  of  tenure,  but  the  refusal  of  the  official  to  take 
advice  from  laymen.  The  loudest  agitator  against  bureau- 
cracy becomes  at  once  the  most  confirmed  bureaucrat  when  he 
gets  into  office,  because  he  determines  to  run  his  office  in  his 
own  way  regardless  of  the  advice  of  those  who  are  compelled 
to  obey  his  orders.  In  this  sense  the  American  office-holder 
is  much  more  of  a  bureaucrat  than  are  the  European  officials 
who  are  compelled  to  consult  the  superior  councils  of  labor 
or  industrial  councils  of  representatives  of  interests.  It  is  for 
this  reason  that  the  legislatures  and  Congress  should  make  it 
mandatory  that  the  Representative  Advisory  Councils  should 
be  created  and  that  the  Industrial  Commissions  and  their 
staffs  should  confer  with  them  before  any  act  of  the  Commis- 
sion can  have  the  validity  of  law.   It  is  also  necessary  that  the 


325 

Civil  Service  Commission  should  appoint  representatives  from 
the  Council  on  its  examining  boards  before  any  valid  eligible 
list  for  appointment  of  subordinates  can  be  made. 

Another  charge  against  Civil  Service  Rules  is  the  objection 
to  permanency  of  tenure  and  the  inability  to  get  rid  of  an  offi- 
cial who  adheres  to  outworn  methods.  This  objection  often 
has  force,  but  the  remedy  is  not  that  of  returning  to  political 
and  partisan  appointments  or  frequent  removals  when  changes 
occur  in  the  political  branch  of  Government.  Officials,  under 
most  Civil  Service  laws,  can  be  removed  at  any  time  provided 
reasons  be  given  and  no  Civil  Service  Commission  should  have 
authority  to  reinstate  any  official,  as  is  the  mistaken  policy  of 
some  States.  Permanency  of  tenure  means  only  permanency 
on  ' '  good  behavior. ' '  The  principal  reason  why  officials  ad- 
here to  old  methods  is  because  there  is  no  continuous  super- 
vising authority  in  a  position  to  force  them  into  new  and  bet- 
ter methods.  The  provision  for  an  Advisory  Council  with 
which  the  officials  are  compelled  to  confer  has  been  found  to 
be  the  most  effective  method  of  compelling  such  officials  to 
keep  up  with  the  changing  conditions  that  require  new  meth- 
ods. If  then  they  are  obstructive  or  incompetent  to  do  this, 
there  is  good  cause  for  removal. 

COMMISSIONS  AND  CLASS  CONFLICTS. 

There  are,  of  course,  criticisms  and  objections  raised  against 
industrial  and  other  commissions.  It  is  not  claimed  here  that 
they  always  work  well.  But  they  work  better  than  the  system 
they  have  displaced  and  they  have  been  found  to  be  the  only 
alternative  where  legislation  attempts  to  regulate  the  rela- 
tions of  great  conflicting  and  hostile  interests.  Many  States 
and  Congress  have  been  forced  by  actual  conditions  to  create 
railroad  and  interstate  commerce  commissions  in  order  to  take 
the  details  of  the  contest  between  railroads  and  shippers  as 
far  as  possible  out  of  the  legislatures  and  the  courts.  Con- 
gress has  been  compelled,  after  twenty-five  years  of  futile  anti- 
trust legislation,  to  turn  over  the  contest  between  trusts  and 


326 

their  competitors  or  customers,  to  a  Federal  Trade  Commis- 
sion. The  contest  between  bankers  and  the  commercial  and 
business  classes  that  depend  on  credit  for  their  existence,  has 
been  turned  over  to  the  Federal  Reserve  Board. 

The  contest  between  capital  and  labor  is  more  serious  than 
any  of  the  other  contests.  Since  the  year  1877  it  has  fre- 
quently resulted  practically  in  civil  war,  with  the  army  or 
militia  called  in  to  suppress  one  side  or  the  other,  according 
to  the  will  of  the  executive.  It  is  claimed  by  some  that  this 
contest  is  irrepressible  and  will  end  in  revolution,  and  at  least 
it  is  plain,  when  the  military  power  is  called  upon  to  decide 
a  contest,  that  the  ordinary  machinery  of  government,  which 
is  fairly  successful  in  other  contests,  has  broken  down. 

It  is  not  a  solution  of  the  contest  to  claim  that  these  out- 
breaks are  caused  solely  by  agitators  and  have  no  foundation 
in  conditions  that  need  remedying.  Such  a  solution,  carried 
to  its  limit,  means  the  suppression  of  free  speech,  free  press, 
and  free  assembly,  which  can  be  accomplished  only  by  military 
power.  That  there  are  conditions  which  need  remedying  is 
shown  by  the  enormous  amount  of  labor  legislation  of  the  past 
three  decades,  and  the  enormous  amount  of  new  legislation 
proposed.  This  legislation  has  come  from  the  free  discussion 
and  investigation  of  actual  labor  conditions,  and,  if  there  is  no 
effective  way  for  this  discussion  to  be  carried  on  and  the  al- 
leged facts  to  be  verified  or  disproved,  then  the  result  must 
be  an  excess  of  unfounded  and  impractical  agitation  mixed 
up  with  real  grievances.  There  are  unbridled  agitators  of 
this  kind  on  both  sides  of  the  contest,  and  it  is  only  when  the 
two  sides  are  brought  together,  and  their  charges,  counter- 
charges, and  alleged  grievances  are  boiled  down  by  investi- 
gation to  the  residuum  of  facts,  that  mere  unfounded  agita- 
tion can  be  expected  to  give  way  to  deliberations  on  remedies 
for  recognized  evils. 

This  does  not  mean  that  both  sides  can  be  made  to  agree 
on  remedies  for  all  evils  and  grievances,  even  after  they  have 
agreed  on  the  facts.  It  means  only  that  there  is  found  to  be 
a  much  larger  field  than  was  supposed  where  they  can  agree, 


327 

and  it  is  worth  while  for  legislation  to  provide  the  means  for 
bringing  both  sides  together  for  a  continuous  search  after  the 
common  points  of  agreement.  "When  they  have  agreed  upon 
and  disposed  of  less  disputatious  points,  they  are  in  a  posi- 
tion to  go  on  to  those  disputed  points  which  had  been  thought 
irreconcilable.  This  is  the  main  reason  for  creating  Industrial 
Commissions  with  adequate  powers  of  impartial  investigation, 
with  conferences  and  discussions  by  both  sides,  and  with 
power  to  decide  on  regulations  and  then  to  enforce  them. 
(Paragraph  5.) 

While  some  of  the  functions  outlined  for  the  proposed  In- 
dustrial Commission  are  now  being  performed  by  the  Depart- 
ment of  Labor  through  its  Bureaus,  it  is  not  proposed  that  the 
Department  be  abolished.  (Paragraph  1.)  It  is  even  pro- 
posed that  in  large  industrial  States  a  similar  department 
might  be  created  in  addition  to  the  Industrial  Commission. 
In  nonindustrial  States,  where  the  labor  department  is  mainly 
educational  and  not  administrative,  there  would,  of  course, 
be  no  occasion  for  an  Industrial  Commission.  Such  occasion 
would  usually  first  arise  in  case  a  workmen's  compensation 
law  were  enacted. 

We  take  it  to  be  commonly  accepted  that  a  Department, 
with  its  head  having  a  seat  in  the  Cabinet,  is  chiefly  designed 
to  advise  and  aid  the  Administration  in  formulating  its  policy 
towards  the  interests  in  charge  of  that  Department,  and  to 
foster  and  promote  the  welfare  of  those. interests.  To  be 
sure,  other  responsibilities  are  entrusted  to  the  Department, 
but  the  foregoing  are  its  prime  duties. 

That  Congress  intended  it  to  be  so  is  manifested  in  the  stat- 
utes creating  the  different  departments.  Thus  the  law  estab- 
lishing the  Department  of  Commerce  declares  that  it  should 
foster,  promote  and  develop  the  foreign  and  domestic  com- 
merce, the  mining,  manufacturing,  shipping  and  fishery  in- 
dustries, and  the  transportation  facilities  of  the  United  States. 
Likewise  in  creating  the  Department  of  Labor  in  1885,  Con- 
gress stated  its  purpose  to  be  the  diffusion  of  "  useful  infor- 
mation on  subjects  connected  with  labor,  in  the  most  general 


328 

and  comprehensive  sense  of  that  word,  and  especially  upon 
its  relation  to  capital,  the  hours  of  labor,  the  earnings  of  la- 
boring men  and  women,  and  the  means  of  promoting  their 
material,  social,  intellectual  and  moral  prosperity. ' '  Congress 
reiterated  its  position  when  it  raised  the  Department  of  Labor 
to  Cabinet  rank  in  declaring  that  its  purpose  should  be  "to 
foster,  promote  and  develop  the  welfare  of  the  wage  earners 
of  the  United  States,  to  improve  their  working  conditions,  and 
to  advance  their  opportunities  for  profitable  employment." 
It  is  also  mandatory  upon  the  Secretary  "to  make  such  spe- 
cial investigations  and  reports  as  he  may  be  required  to  do 
by  the  President,  or  by  Congress,  or  which  he  himself  may 
deem  necessary." 

Congress  has  not  only  declared  that  it  regards  Cabinet 
officers  or  Department  heads  as  the  personal  choice  of  the 
President,  whom  they  are  to  assist  in  formulating  his  execu- 
tive policy,  but  it  has  also  accepted  it  in  practice.  This  is 
illustrated  by  the  fact  that  the  Senate,  even  when  controlled 
by  an  opposition  party,  usually  ratifies  the  President's  nom- 
inations promptly  and  without  objections. 

When  influential  economic  groups  feel  that  the  Government 
can  be  of  assistance  in  promoting  their  interests,  they  set  about 
to  bring  political  pressure  to  bear  upon  Congress  to  create 
a  Department  that  will  concern  itself  with  their  welfare.  Thus 
the  Department  of  Agriculture  was  created  in  1889,  largely 
through  the  efforts  of  the  National  Grange  and  other  farmers' 
organizations.  In  the  same  way  the  Department  of  Commerce 
was  created  on  the  petition  of  the  business  and  manufacturing 
interests. 

Of  course,  the  different  Departments  have  also  been  en- 
trusted with  administrative  duties.  The  Department  of  Ag- 
riculture administers  the  meat  inspection  service,  the  Depart- 
ment of  Commerce  the  steamship  inspection  service,  the  De- 
partment of  Labor  the  immigration  service,  and  so  on.  How- 
ever, whenever  an  acute  administrative  problem  arises,  owing 
to  an  intense  conflict  between  two  opposing  economic  inter- 
ests, and  requiring  a  disinterested  enforcement  of  law,  it  has 


329 

usually  not  been  entrusted  to  one  of  these  political  Depart- 
ments. Hence,  when  Congress  turned  its  attention  to  the  dis- 
pute between  the  railroads  and  the  great  majority  of  shippers, 
it  did  not  create  a  Department  of  Commerce  to  administer 
the  law,  but  instead  entrusted  it  to  the  Interstate  Commerce 
Commission,  a  disinterested  and  nonpolitical  body.  Again, 
when  Congress  determined  upon  legislation  to  deal  with  "the 
new  economic  problem  involved  in  the  increased  tendency  to- 
ward concentrated  ownership  of  the  large  industries  of  the 
country,"  no  one  even  thought  of  suggesting  that  this  matter 
be  turned  over  to  the  Department  of  Commerce.  On  the  con- 
trary, without  a  single  objection,  an  independent  adminis- 
trative commission,  the  Federal  Trade  Commission,  was  cre- 
ated to  enforce  the  legislation.  The  same  is  true  with  the  Fed- 
eral Reserve  Board.  Congress  has  also  applied  this  policy  to 
the  labor  problem.  The  first  important  administrative  act 
directly  affecting  capital  and  labor  was  not  assigned  to  the 
Department  of  Labor  for  execution,  but  to  a  disinterested  and 
nonpolitical  board.  We  refer  to  the  Newlands  Act  of  1913, 
and  preceding  acts  relating  to  arbitration  of  labor  disputes 
on  railroads.  When  an  effort  was  made  to  place  the  admin- 
istration of  this  act  under  the  Department  of  Labor,  both  the 
railroad  companies  and  the  railroad  brotherhoods  opposed 
and  prevented  the  change. 

We  are  of  the  opinion  that  if,  in  dealing  with  the  labor 
problem,  this  policy  is  carried  out  consistently,  considerable 
of  the  industrial  unrest  will  be  allayed.  We  believe  that  it 
should  be  the  conscious  policy  of  Congress  to  separate  the 
policy-determining  functions  from  the  administrative  func- 
tions. The  Department  of  Labor  should  be  entrusted  with 
investigations  that  would  aid  the  President  and  his  adminis- 
tration in  determining  upon  a  labor  policy.  It  should  also 
be  the  educational  medium  through  which  the  country  is  to  be 
informed  on  the  various  labor  issues  that  need  solution  or 
have  not  yet  been  legislated  upon.  As  a  matter  of  fact,  this 
has  been  the  Department's  chief  and  most  effective  activity. 
A  glance  at  the  list  of  publications  of  the  Department  shows 
the  influence  it  has  had  as  a  pioneer  in  labor  legislation  in  this 


330 

country.  The  present  unanimity  of  opinion  in  favor  of  work- 
men's compensation,  safety  and  sanitation,  vocational  train- 
ing and  employment  bureaus,  is  largely  due  to  its  having  con- 
centrated upon  educating  the  public  to  the  need  of  such  legis- 
lation. And  the  Department  wisely  continues  to  fulfill  its 
chief  mission  by  pointing  the  way  to  future  improvement  of 
the  conditions  of  labor.  Its  recent  publications  aim  to  en- 
lighten and  crystallize  public  opinion  on  such  mooted  but  vital 
questions  as  sickness  and  unemployment  insurance,  old  age 
pensions,  housing  of  workingmen,  cooperation,  employers' 
welfare  work,  home  and  factory  conditions  of  women  and  chil- 
dren. To  make  its  work  still  more  effective  the  Department 
has  begun  issuing  a  monthly  review  which  will  supply  infor- 
mation on  all  questions  affecting  labor.  We  have  no  doubt 
that  with  the  aid  of  the  Department  of  Labor,  legislation  upon 
these  subjects  will  be  secured  sooner  than  otherwise. 

On  the  other  hand,  when  public  opinion,  through  legislation, 
has  determined  upon  a  policy,  it  is  vital  to  its  success  that  it  be 
administered  by  disinterested  persons  not  connected  with  a 
political  department.  This  is  necessary  in  order  to  obtain  the 
mutual  and  voluntary  cooperation  of  employers  and  em- 
ployees, and,  unless  they  are  assured  of  a  disinterested  ad- 
ministration of  the  law,  they  will  be  reluctant  to  assist  in  its 
successful  enforcement.  Naturally  a  department  which  ini- 
tiates and  advocates  new  legislation  is  bound  to  antagonize 
those  who  are  not  in  accord  with  its  views.  It  is  futile  to 
expect  the  Department  of  Labor  to  get  the  good  will  and  co- 
operation of  those  whom  it  successfully  defeated  in  the  legis- 
lative battle.  We  must  remember  that  the  Department  is  con- 
stantly advocating  new  legislation,  even  while  it  is  adminis- 
tering that  which  has  been  enacted.  Thus  the  bitter  feeling 
against  it  is  bound  to  be  permanently  at  high  pitch,  and  those 
who  differ  from  it  would  likely  have  no  confidence  in  its  being 
able  to  administer  the  law  disinterestedly.  Then,  too,  as  we 
shall  show,  if  a  law  is  administered  through  a  political  de- 
partment, its  efficient  administration  may  be  subordinated  to 
political  expediency. 


331 

It  is  in  order  to  avoid  these  difficulties  that  we  recommend 
the  method  already  adopted  in  several  States.  We  believe 
that  an  Industrial  Commission,  removed  from  the  heat  of  po- 
litical controversy,  created  with  the  safeguards  proposed  here- 
in, would  have  the  confidence  of  employers  and  employees. 
Although  employers  and  employees  may  have  hopelessly  di- 
vergent opinions  on  policy,  yet  when  the  policy  is  once  deter- 
mined upon  by  Congress  they  are  equally  concerned  in  its 
efficient  and  disinterested  administration.  If  assured  of  this, 
they  cooperate  in  its  successful  enforcement. 

Furthermore,  much  opposition  to  labor  legislation,  both  by 
capital  and  labor,  is  based  upon  the  fear  that  its  administra- 
tion will  be  partial.  And  even  when  such  legislation  is  enacted, 
unless  both  sides  have  confidence  in  the  disinterestedness  of 
the  administrators,  it  is  doomed  to  remain  a  dead  letter  on 
the  statute  books. 

In  recommending  that  the  policy-determining  function  be 
separated  from  the  administrative  function,  we  wish  to  sep- 
arate, as  much  as  possible,  the  problems  upon  which  capital 
and  labor  disagree  from  those  in  which  they  have  a  common 
interest.  Legislation  is  a  matter  of  opinion.  Men  may  hon- 
estly differ  as  to  the  wisdom  of  a  certain  law.  Difference  of 
opinion  when  strongly  contested  invariably  engenders  suspi- 
cion and  distrust.  Hence,  if  an  Industrial  Commission  were 
called  upon  to  initiate  and  advocate  new  legislation  it  would 
be  forced  to  antagonize  and  lose  the  good  will  of  either  capital 
or  labor,  or  of  both.  Such  an  outcome  must  inevitably  ham- 
per its  administrative  duties,  which  it  can  not  carry  out  suc- 
cessfully unless  it  has  the  confidence  of  both  sides. 

But  it  is  highly  essential  that  the  conditions  of  labor  be 
constantly  improved  and  adjusted  to  new  industrial  develop- 
ments. This  function  of  studying  and  promulgating  the  best 
policies  for  promoting  the  welfare  of  labor  should  be  left  to 
the  Department  of  Labor,  as  originally  intended  when  cre- 
ated. The  future  interest  of  our  country  demands  that  a 
Department  devote  itself  exclusively  to  the  furtherance  of  the 
welfare  of  labor.    New  problems  must  constantly  be  studied, 


332 

information  furnished  and  remedies  suggested.  Considering 
that  in  the  final  analysis  public  opinion,  as  expressed  through 
legislation,  determines  the  nature  of  the  remedy,  it  is  proper 
that  a  political  department  be  entrusted  with  the  duty  of  aid- 
ing in  determining  that  policy.  It  is  with  this  idea  in  mind 
that  we  make  the  distinction  between  the  enactment  of  law, 
which  is  political  in  its  nature  and  must  be  fought  out  in  the 
Congress  and  in  the  Cabinet,  and  the  administration  of  law, 
which  is  nonpolitical  and  should  be  administered  by  disinter- 
ested parties  in  cooperation  with  representatives  of  capital 
and  labor. 

The  conclusion  is  that  all  subjects  upon  which  Congress  has 
not  legislated  so  as  to  require  an  administrative  department 
should  be  in  the  hands  of  the  Department  of  Labor.  Among 
these  are  the  important  subjects  of  sickness  insurance,  inval- 
idity insurance,  unemployment  insurance,  old  age  pensions, 
occupational  disease,  child  and  woman  labor,  and  so  on.  The 
Department  should  make  studies  of  comparative  administra- 
tion of  labor  law  and  the  administration  of  laws  in  the  States. 
Other  subjects  might  be  mentioned.  In  fact  there  should  be  no 
limitation  on  its  field  of  investigation  and  the  education  of  the 
public  to  the  evils  which  labor  suffers  and  the  remedies  that 
should  be  adopted. 

The  Industrial  Commission  is  purely  an  administrative  body 
not  intended  to  promote  new  legislation,  except  where  it  is 
needed  in  connection  with  its  administration  of  existing  laws. 
Other  new  legislation  gets  its  initiative  elsewhere.  The  proper 
place  for  opposing  interests  to  make  their  fight  on  new  laws 
is  in  the  State  legislatures  and  in  Congress.  Each  side  neces- 
sarily endeavors  to  elect  its  representatives,  to  employ  its 
lobby,  and  to  use  every  honorable  method  in  its  power  to  defeat 
the  other  side.  The  outcome  is  usually  a  compromise  not 
wholly  satisfactory  to  either.  But  it  does  not  follow  that  the 
fight  should  be  kept  up  in  the  administration  of  the  laws  that 
are  enacted.  Whatever  they  are  they  should  be  enforced  ex- 
actly as  they  stand,  and  neither  side  should  control  the  ex- 
ecutive and  administrative  officers.    These  should  be  impar- 


333 

tial.  It  is  because  executive  officials  are  mainly  partisans  that 
the  administration  of  labor  laws  in  this  country  has  broken 
down.  They  may  be  appointed  by  political  parties,  but  back 
of  the  politicians  are  the  employers  or  the  trade  unions  that 
make  secret  or  open  deals  with  the  politicians  in  order  to  con- 
trol the  offices.  It  can  not  be  expected  that  employers  will 
readily  accept  investigation  or  obey  the  orders  of  officials 
whom  they  know  or  suspect  to  be  agents  of  unions  or  of  poli- 
ticians, intent  on  strengthening  unionism  or  making  political 
capital  out  of  their  positions.  It  is  natural  that  employer  I 
should  protect  themselves  either  by  getting  their  own  agents 
into  the  positions  or  by  getting  a  weak  and  inefficient  trade- 
unionist  appointed.  In  any  case,  the  laws  are  not  enforced, 
and  the  laboring  classes,  in  turn,  become  desperate  and  de- 
fiant of  Government.  An  illustration  is  found  in  the  recent 
industrial  troubles  in  Colorado.  Probably  no  State  of  its  size 
in  the  Union  has  had  upon  its  statute  books  more  labor  laws 
than  Colorado,  nor  more  trade  union  representatives  in  office 
to  enforce  them,  yet  the  nonenforcement  of  the  labor  laws 
was  undoubtedly  one  of  the  contributing  causes  of  the  recent 
troubles.  The  history  of  many  other  States  is  similar,  so  far 
as  nonenforcement  is  concerned.  Labor  representatives  al- 
ternate with  employer  representatives  or  with  labor  poli- 
ticians, who  make  a  show  of  enforcing  the  laws  while  the 
masses  of  labor  get  no  substantial  benefit. 

American  experience  has  shown  that  this  situation  oan  be 
met  only  by  a  nonpartisan  commission,  removed  as  far  as  pos- 
sible from  politics.  In  other  countries,  and  in  British  colonies 
having  parliamentary  forms  of  government,  this  kind  of  sep- 
arate commission  is  not  required,  for  the  good  reason  that  the 
cabinet  officer  who  enforces  the  labor  laws  is  a  member  of 
parliament,  and  parliament  must  be  dissolved  and  a  new  elec- 
tion ordered  if  the  cabinet  loses  control.  Having  a  seat  on 
the  floor  of  the  legislature  he  must  answer  questions  put  by 
the  opposition.  If  one  of  his  subordinates  is  inefficient  or 
takes  sides  against  employers  or  unions,  some  one  in  parlia- 
ment is  liable  to  rise  and  demand  explanations,  and  the  cabinet 


334 

minister  is  compelled  to  explain  and  to  stand  by  the  subordin- 
ate or  to  repudiate  him.  The  opposition  may  even  be  able  to 
defeat  the  ministry  and  get  a  new  election.  Consequently, 
cabinet  officers  are  responsible  to  parliament,  and,  although 
they  are  partisans  and  politicians,  they  are  careful  that  their 
subordinates,  who  actually  administer  the  laws,  shall  be  im- 
partial and  efficient.  In  no  other  country,  governed  by  a  par- 
liament, would  such  important  boards  as  the  Interstate  Com- 
merce Commission,  the  Federal  Trade  Commission,  the  Fed- 
eral Reserve  Board,  or  the  State  railroad  and  public  utility 
commissions,  be  taken  out  from  under  the  jurisdiction  of  a 
responsible  cabinet  minister.  In  this  country  it  is  found  nec- 
essary to  make  them  wholly  or  partly  independent,  because 
there  is  no  officer  directly  responsible  to  the  legislature  or  the 
people  who  can  be  given  control  over  them. 

The  same  is  true  of  the  labor  departments  of  parliamentary 
countries  compared  with  such  departments  in  the  American 
State  and  Federal  Governments.  The  issues  in  this  country 
are  too  vital  and  menacing,  they  are  too  easily  turned  into  po- 
litical capital,  and,  at  the  same  time,  the  politicians  in  charge 
are  too  little  responsible  to  the  legislatures,  to  Congress  and 
to  the  voters,  for  the  American  people  to  leave  them  in  the 
hands  of  partisan  or  political  officials.  The  plan  of  an  Indus- 
trial Commission  with  a  Representative  Council  as  herein 
recommended,  is  based  on  American  experience  and  fitted  to 
American  conditions  in  dealing  with  such  issues  of  opposing 
interests. 

But  the  commissions  created  to  deal  with  the  relations  be- 
tween other'opposing  interests  can  not  be  accepted  as  models 
for  dealing  with  the  opposing  interests  of  capital  and  labor. 
The  Interstate  Commerce  Commission  was  designed  to  recon- 
cile the  opposing  interests  of  railroads  and  shippers,  the  Fed- 
eral Trade  Commission  of  monopolies  and  competitors,  the 
Federal  Reserve  Board  of  bankers  and  borrowers,  but  in  none 
of  these  cases  were  the  opposing  interests  strongly  organized 
for  aggression  and  occasional  paralysis  of  business  verging 
on  civil  war.    It  was  not  so  necessary  then  that  the  opposing 


335 

sides  should  be  strongly  represented,  as  is  recommended  in 
the  creation  of  the  Advisory  Representative  Council.  This 
Council  is  a  kind  of  parliament  designed  to  hold  the  Commis- 
sion continuously  to  the  impartial  performance  of  its  duties 
and  the  accuracy  of  investigations  upon  which  the  impartial 
performance  of  duties  depends. 

The  Industrial  Commission,  as  here  proposed,  adopts  meth- 
ods in  the  field  of  labor  laws  similar  to  those  that  collective 
bargaining  between  unions  and  employers  adopts  in  drawing 
up  voluntary  joint  agreements.  Modern  trade  agreements  are, 
in  fact,  almost  complete  codes  of  labor  law  for  a  particular 
industry,  and,  if  voluntary  collective  bargaining  could  become 
universal  and  effective  for  all  employers  and  employees,  then 
the  State  or  Government  might  not  need  to  enact  many  labor 
laws.  Something  like  this  is  actually  attempted  in  those 
countries  having  compulsory  arbitration.  They  provide  easy 
methods  for  organizing  and  perpetuating  unions  of  employers 
and  unions  of  employees.  They  try  to  induce  the  represent- 
atives of  these  unions  voluntarily  to  recognize  each  other,  to 
get  together  to  investigate  grievances  and  demands,  to  confer 
and  to  draw  up  and  enforce  a  joint  agreement  covering  all 
alleged  evils  and  grievances.  If  they  can  not  succeed  in  doing 
this  they  provide  a  court  of  arbitration  with  substantially  all 
the  powers  that  the  conferees  of  the  unions  and  employers 
would  have  if  they  acted  without  compulsion. 

But  compulsory  arbitration  is  too  remote  to  be  considered, 
or  even  anything  which  would  logically  lead  to  compulsory 
arbitration.  In  Paragraph  14  we  recommend  voluntary  col- 
lective bargaining  with  the  Government  acting  only  as  medi- 
ator without  any  compulsory  powers.  Our  alternative  pro- 
posed for  compulsory  arbitration  is  in  part  an  Industrial  Com- 
mission with  a  Council  of  employers  and  employees. 

The  need  of  an  Industrial  Commission  becomes  more  press- 
ing in  proportion  as  new  laws  are  enacted  and  new  executive 
duties  are  added.  It  was  the  introduction  of  workmen's  com- 
pensation that  forced  attention  to  the  situation.    Here  is  a  new 


336 

type  of  legislation  which  is  so  evidently  a  matter  in  which 
employers  are  as  much  concerned  as  employees,  that  it  was 
not  considered  proper  to  entrust  its  administration  to  a  De- 
partment controlled  solely  in  the  interests  of  labor.  Conse- 
quently separate  commissions  were  created,  independent  of 
the  labor  bureau,  or  else  the  compensation  law  was  put  in 
charge  of  the  courts. 

But  the  most  important  effect  of  the  compensation  laws  is 
not  the  compensation  to  workmen,  for  no  law  pretends  to  pay 
workman  anything  for  his  suffering,  nor  even  to  pay  him  his 
total  loss  in  wages.  The  most  important  effect  is  the  universal 
pressure  on  employers  to  prevent  accidents  and  to  heal  the  in- 
jury as  soon  as  possible. 

Wherever  this  object  of  the  law  was  understood,  either 
the  work  of  factory  inspection  for  accident  prevention  was 
taken  from  the  labor  bureau,  or  the  compensation  commis- 
sion and  the  labor  bureau  were  consolidated.  One  reason  for 
doing  this  is  that  employers  have  become  as  much  interested 
in  accident  prevention  as  have  workmen,  for  it  becomes  a 
matter  of  business  and  profits.  Another  reason  is  that  the 
compensation  commission  itself  may  not  be  tempted  to  exalt 
the  less  important  object  of  compensation  over  the  more  im- 
portant one  of  accident  prevention  and  speedy  cure. 

The  employers  now  become  just  as  much  concerned  as  the 
employees  in  having  an  efficient  factory  inspection.  They  must 
do  their  own  inspection  anyhow  for  the  sake  of  reducing  the 
costs  of  compensation,  and  they  do  not  need  to  be  prosecuted 
as  they  did  before.  What  they  need  in  factory  inspection  is 
the  help  of  inspectors  who  are  expert  in  showing  them  how  to 
prevent  accidents,  and  how  to  organize  safety  committees  and 
to  get  the  "safety  habit"  into  their  employees.  Whatever 
reason  may  formerly  have  existed  for  trade  unions  to  get 
their  members  appointed  as  factory  inspectors,  in  order  to 
drive  home  prosecutions,  no  longer  exists.  Neither  do  em- 
ployers any  longer  have  reason  for  using  political  or  under- 
handed methods  in  order  to  get  weak  and  inefficient  inspectors 
appointed.    Employers  now  wish  to  cooperate  with  factory 


337 

inspectors,  and  the  only  kind  they  can  cooperate  with  are 
those  who  are  impartial  and  efficient.  The  fact  that  employers 
have  taken  the  lead  in  their  three  great  safety  organizations 
mentioned  under  Paragraph  1,  instead  of  being  led  by  State 
and  Federal  labor  officials,  shows  unmistakably  the  need  of 
enlisting  employers  in  at  least  this  branch  of  labor  law. 

Another  subject,  unemployment,  the  most  serious  and  dis- 
tressing of  all,  is  almost  universally  agreed  as  needing  a  com- 
prehensive plan  of  employment  offices.  It  is  now  generally 
admitted  that  it  must  be  dealt  with  by  the  Federal  Government. 
Both  England  and  Germany  have  national  systems  of  public 
employment  offices.  The  English  system  is  operated  directly 
by  the  national  government,  the  German  system  is  operated  by 
the  city  and  state  governments  correlated  and  supervised  by 
the  federal  government.  A  combination  of  both  methods  will 
perhaps  be  necessary  in  this  country.  Bills  have  already  been 
introduced  in  Congress,  and  the  Department  of  Labor  has 
begun  the  establishment  of  offices.  But,  in  the  contest  between 
employers  and  trade  unions,  the  control  of  employment  offices 
is  essential  to  either  side.  The  antiunion  employers '  associa- 
tions already  have  sufficient  employment  offices,  and  many 
local  trade  unions  have  employment  agencies  of  their  own. 

Employers  control  the  jobs.  They  hire  whom  they  please. 
Surely  they  can  not  be  expected  to  hire  workmen  sent  to  them 
by  trade  unionists  or  politicians  who  happen  to  run  the  public 
employment  offices.  This  accounts  for  the  inefficiency  of  the 
offices  in  almost  every  place  where  they  have  been  tried.  They 
sink  to  the  level  of  charity,  finding  occasional  short  jobs  for 
casuals,  but  do  not  become  the  great  labor  exchanges  which 
they  should  be  as  the  first  step  in  dealing  with  the  most  serious 
of  all  problems,  unemployment.  Experience  shows  that  em- 
ployers must  have  confidence  in  the  ability  and  impartiality 
of  the  officials  who  run  the  employment  offices  or  they  will 
not  patronize  them.  On  the  other  hand,  trade  unionists  must 
have  confidence  that  the  offices  will  not  be  used  to  furnish 
strike-breakers.  The  only  effective  solution  of  this  predica- 
ment is  the  management  of  these  offices  by  joint  committees 


338 

of  organized  employers  and  organized  employees  and  their 
joint  Civil  Service  examination  of  the  officials  who  run  the 
offices.  Under  the  Industrial  Commission  plan  there  are  not 
only  Representative  Councils  at  the  national  headquarters,  but 
similar  Councils  for  each  State  and  for  each  local  office. 

Furthermore,  no  Federal  legislation  is  more  urgent  than 
the  supervision  of  private  commercial  offices  doing  an  inter- 
state business.  If  this  country  expects  to  promote  public 
offices  and  to  regulate  private  offices,  the  only  effective  way 
is  through  joint  control  by  the  acknowledged  representatives 
of  organized  employers  and  employees,  cooperating  with  a 
Federal  commission  that  is  impartial  and  nonpolitical. 

The  subject  of  industrial  education  is  vital  to  the  Nation 
as  a  whole  and  immediately  critical  for  both  employers  and 
employees.  Yet,  when  a  bill  is  introduced  in  Congress  for 
national  aid  to  industrial  education,  the  administration  is  not 
placed  under  the  Department  of  Labor,  where  it  would  natur- 
ally belong  and  where  more  has  been  done  than  in  all  other 
departments  in  the  investigation  of  the  subject.  It  is  pro- 
posed to  place  the  administration  under  an  ex  officio  board  of 
cabinet  officers  with  an  officer  of  the  Bureau  of  Education  act- 
ing as  executive.  Furthermore,  no  standards  of  efficiency  are 
imposed  upon  the  States  as  a  condition  of  receiving  the  funds 
appropriated  out  of  the  Federal  Treasury.  (Paragraph  17.) 
This  bill  combines  the  features  of  political  control,  | '  pork  bar- 
rel" finance  and  exclusion  of  the  two  great  interests  of  em- 
ployers and  employees  who  are  most  directly  concerned.  The 
reasons  for  such  recommendations  are  the  popular  demand 
for  industrial  education,  and  the  lack  of  any  effective  method 
of  bringing  together  the  representatives  of  employers  (in- 
cluding farmers)  and  employees.  Such  representatives  are 
the  ones  who  know  the  needs  of  industry  and  agriculture  and 
are  competent,  with  the  aid  of  qualified  educators,  provided 
neither  side  dominates  the  other,  to  set  up  the  standards  of 
efficient  industrial  training  which  should  be  made  the  essential 
condition  of  receiving  Federal  aid.  For  this  purpose  the  In- 
dustrial Commission  should  add  to  its  Advisory  Council  rep- 


339 

resentatives  of  organizations  of  educators,  such  as  the  Na- 
tional Education  Association,  and  the  National  Society  for 
Promotion  of  Industrial  Education.  The  Federal  Industrial 
Commission,  upon  the  advice  of  such  a  Council,  including  em- 
ployers, employees,  farmers  and  educators,  could  then  deter- 
mine the  standards  as  a  basis  for  receiving  subsidies,  which 
should  probably  require  the  States  to  provide  governing 
boards  of  employers,  employees,  farmers  and  educators,  con- 
tinuation day  schools  with  compulsory  attendance  on  the  em- 
ployer 's  time,  adequate  training  of  teachers  with  practical  in- 
dustrial experience,  and  so  on. 

In  making  the  preceding  three  recommendations  no  reflec- 
tion is  intended  on  any  particular  State  or  Federal  official 
now  charged  with  the  administration  of  labor  laws.  It  is  con- 
ceded that  many  of  them  may  be  doing  the  best  work  possible 
under  existing  laws.  But  it  is  recognized  that  the  conditions 
under  which  they  work  make  it  impossible  either  to  administer 
existing  laws  effectively,  or  to  assume  the  administration  of 
additional  laws  urgently  required  to  meet  the  increasingly  dif- 
ficult and  complex  problems  of  capital  and  labor. 

Instead  of  interfering  with  the  commendable  work  of  trade 
unions  the  recommendations  are  intended  to  strengthen  union- 
ism at  its  weakest  point.  One  of  the  most  serious  obstacles 
in  the  way  of  a  harmonious  labor  movement  is  the  struggle  of 
ambitious  unionists  to  get  the  endorsement  and  control  of 
their  unions  for  political  positions.  The  conflicts  within  unions 
for  such  endorsement  and  support  are  notorious  in  weakening 
the  unions.  Furthermore,  in  order  to  get  and  hold  a  political 
position  the  unionist  must  make  alliance  or  connivance  with 
and  concessions  to  the  leaders  of  political  parties,  and  there- 
fore is  not  free  to  support  consistently  the  demands  of  labor. 
He  must  also  often  support  or  even  appoint  other  politicians 
whose  influence  is  used  against  the  unions.  This  unquestion- 
ably weakens  or  destroys  the  confidence  of  laborers  generally 
in  the  integrity  and  faithfulness  of  all  their  leaders  who  accept 
political  positions,  or  are  suspected  of  trying  to  get  such  po- 
sitions.   It  is  only  when  the  union  representative  is  paid  from 


340 

his  union  treasury  instead  of  the  public  treasury,  and  is  re- 
called by  his  union,  that  he  is  truly  representative  and  the 
union  itself  has  a  sound  basis  for  permanency  and  growth. 

Our  recommendations  adopt  this  principle  and  counteract 
this  weakness  of  unionism  by  making  their  representatives 
on  the  Advisory  Council  dependent  solely  on  the  unions.  They 
receive  no  salaries  from  the  public  treasury,  and  can  be  re- 
called at  any  time  when  they  cease  to  be  representative.  The 
result  is  that  the  unions  usually  nominate  for  such  positions 
their  regular  officers  or  business  agents  who  receive  salaries 
from  the  union  treasury  for  other  purposes.  Under  such  cir- 
cumstances there  can  ordinarily  be  no  question  of  the  union 
representatives  "selling  out"  to  employers  or  politicians. 

INVESTIGATIONS. 

4.  The  Industrial  Commissions  to  make  and  publish  investi- 
gations and  recommendations  on  all  subjects  whose  adminis- 
tration is  entrusted  to  them.  Investigations  and  recommend- 
ations on  other  subjects  to  be  made  only  on  the  request  of  the 
legislature,  Congress,  or  the  court.  (Paragraphs  12,  13.) 
Since  it  is  provided  (paragraph  14)  that  the  Federal  and 
State  Commissions  shall  co-operate  in  the  mediation  of 
labor  disputes,  the  Federal  Commission  should  be  the  agency 
to  which  the  States  should  look  for  continuous  investigations 
and  publications,  for  the  entire  country,  of  wages,  hours  of 
labor,  cost  of  living,  joint  trade  agreements  and  all  subjects 
involved  in  labor  disputes,  but  the  names  of  establishments  or 
individuals  should  be  kept  confidential.  It  should  publish,  at 
least  annually,  a  report  on  all  strikes,  lockouts,  boycotts, 
blacklists,  that  have  terminated  during  the  year,  but  should 
not  make  such  investigations  during  an  industrial  dispute 
unless  consented  to  by  both  parties  in  the  manner  elsewhere 
provided.    (Paragraph  14.)    In  making  such  reports  it  should 


341 

give  all  material  facts,  including  demands,  negotiations, 
picketing,  strikebreakers,  conciliation,  the  acts  of  State  or 
Federal  authorities,  as  well  as  joint  agreements  reached  with 
or  without  cessation  of  business.  In  preparing  these  reports 
the  Commission  should  not  call  upon  any  mediator,  but  should 
if  necessary,  use  its  powers  of  compulsory  testimony. 

In  order  to  assist  State  minimum  wage  commissions  in  the 
most  difficult  part  of  their  work  the  Federal  Commission 
should  also  investigate  and  report  upon  interstate  competi- 
tion and  the  effect  of  minimum  wage  laws.  Such  investiga- 
tions are  of  assistance  also  in  determining  other  questions. 
State  Commissions  should  make  reports  on  safety,  compensa- 
tion for  accidents,  minimum  wages  investigations,  employ- 
ment offices,  child  labor,  etc. 

No  publication  of  any  investigations  to  be  made  or  any 
rules  (Paragraph  5)  to  be  issued  without  previously  sub- 
mitting them  to  all  members  of  the  Representative  Advisory 
Council,  with  opportunity  for  criticism,  the  latter  to  be  pub- 
lished by  the  Commission  with  its  own  report.  All  forms, 
schedules  and  instructions  for  investigators  likewise  to  be 
submitted  to  the  advisory  council. 

These  recommendations  regarding  investigations  are  the 
most  important  of  all  the  recommendations  regarding  the  In- 
dustrial Commission.  All  of  the  other  recommendations  cul- 
minate in  the  validity  of  its  investigations.  Investigations 
furnish  the  basis  for  drafting  laws  by  the  legislature,  for 
formulating  rules  and  regulations  by  the  Commission  (Par- 
agraph 5),  for  interpretation  of  laws  and  rules  by  the  courts, 
and  for  prosecutions  in  enforcing  the  laws.  The  recommenda- 
tions for  an  Industrial  Commission,  for  an  Advisory  Council, 
for  Civil  Service  appointments,  for  subsidies  (Paragraph  17) 
and  for  court  procedure  (Paragraph  7)  are  all  directed 
toward  securing  reliability  and  confidence  in  the  investiga- 
tions and  conclusions  of  the  Commission. 


342 

It  is  required  that  all  investigations  and  proposed  publica- 
tions shall  be  submitted  to  the  Representative  Council  before 
they  are  issued  and  time  enough  given  for  consideration  and 
criticism.  If,  then,  any  rules  are  issued  (Paragraph  5)  or 
investigations  published  without  the  approval  of  either  side, 
their  validity  and  accuracy  are  at  once  condemned  and  the 
Commission  is  discredited.  Under  a  partisan  or  political  de- 
partment of  labor,  it  is  unlikely  that  statistics  and  investiga- 
tions are  accepted,  either  by  the  public  or  by  both  employers 
and  employees,  at  their  face  value.  Nothing  more  serious 
can  exist,  in  a  country  which  depends  so  much  on  public  opin- 
ion, than  this  distrust  of  official  publications  and  statistics 
which  purport  to  give  all  the  facts  upon  which  public  opinion 
forms  its  conclusions.  Employers,  employees  and  the  general 
public  should  be  able  to  rely  implicitly  for  their  conclusions 
on  official  statistics  on  wages,  hours  of  labor,  health,  safety, 
cost  of  living,  unemployment,  costs  of  production,  distribu- 
tion of  wealth,  strikes,  boycotts,  and  all  other  material  facts 
bearing  on  the  relations  of  capital  and  labor.  All  labor  legis- 
lation, all  administration  of  labor  laws,  all  efforts  at  mediation 
and  arbitration,  all  recommendations  of  public  bodies,  go 
back,  for  their  justification,  to  statistics  and  investigations. 
The  money  of  the  Government  is  worse  than  wasted  and  the 
officials  are  discredited  if  there  remains  any  interested  body  of 
citizens  who  do  not  place  confidence  in  these  official  statistics 
and  investigations.  The  temptation  is  so  great,  in  view  of 
the  struggle  between  capital  and  labor,  to  distort  or  suppress 
or  obliterate  facts,  that  no  precautions  too  great  can  be  taken 
to  secure  thorough  criticism,  verification,  and  filling  in  of 
omissions,  before  the  facts  are  published.  No  matter  what- 
ever else  may  be  recommended,  no  recommendation  can  be  de- 
pended upon  that  does  not  provide  fully  for  the  integrity, 
reliability  and  complete  inclusion  of  all  material  facts  in  every 
publication  of  official  statistics  and  investigations.  There  is 
no  certain  method  of  doing  this  except  in  the  recommendation 
that  all  alleged  facts  of  statistics  and  investigations  be  sub- 
mitted to  the  parties  directly  interested  and  affected  by  the 
conclusions.     The  proposed  Advisory  Council  composed  of 


343 

acknowledged  representatives  of  these  parties,  acting  inde- 
pendently, without  intimidation  or  connivance,  and  watchful 
against  any  advantage  attempted  by  the  opposing  yet  coop- 
erating interest,  consulting  their  constituents  on  any  matter, 
can  be  trusted  to  see  to  it  that  no  material  facts  or  conclusions 
are  published  without  conclusive  proof  and  none  suppressed 
without  disproof.  If  any  member  of  the  Council  objects  to 
any  final  statement  or  conclusion  he  is  entitled  within  limits 
to  have  his  protest  published  along  with  the  report  of  the 
Commission.  In  fact,  the  entire  spirit  of  these  recommenda- 
tions is  the  utilization  by  Government  of  the  organizations 
that  have  both  common  and  hostile  interests  in  order  to  pro- 
tect the  Government  itself  against  partisanship  and  partiality 
in  dealing  with  the  serious  conflict  between  those  interests.  It 
is  because  the  reports,  findings,  and  recommendations  of  the 
present  Commission  were  not  submitted  to  parties  affected 
thereby  or  to  an  Advisory  Committee  similar  to  the  one  pro- 
posed for  a  permanent  Commission,  that  we  can  not  accept 
them  as  verified  or  criticised  so  that  we  could  have  before  us 
when  finally  acting  upon  them  any  criticisms  or  assurance  that 
their  statements  were  accurate  or  that  important  omissions 
had  not  been  made.  An  Advisory  Committee  to  this  Commis- 
sion, similar  to  the  one  proposed,  was  approved  for  a  short 
time,  and  after  making  changes  in  the  proposals  of  the  staff 
having  the  measures  in  charge,  made  certain  unanimous  re- 
commendations as  bills  to  this  Commission,  but  the  committee 
was  discontinued  before  it  could  complete  its  work.  No  staff 
of  investigators,  however  careful,  can  be  expected  to  have 
such  complete  knowledge  of  their  subject  as  to  be  trusted 
without  the  scrutiny  and  criticism  of  the  interests  or  persons 
affected  by  their  reports.  Whenever  a  permanent  Indus- 
trial Commission  is  created  there  can  be  no  provision  more 
essential  than  that  of  providing  the  representative  machinery 
for  reliable  investigations,  findings  and  publicity. 

An  illustration  of  the  method  of  supervision  of  investiga- 
tion here  advocated  is  afforded  by  the  Interstate  Commerce 
Commission.    The  statistics  of  wages  and  hours  collected  by 


344 

that  Commission  are  of  importance  in  matters  of  mediation. 
They  were  so  collected  and  arranged  that  they  could  not  be 
relied  upon  for  that  purpose.  Consequently  a  conference  was 
called,  consisting  of  the  railway  accountants,  the  railroad 
brotherhoods  and  other  labor  organizations,  the  statisticians 
of  the  Commission  and  of  the  Department  of  Labor,  to  consid- 
er the  statistics.  After  the  discussion,  which  failed  in  some 
respects  to  reach  agreement,  the  Interstate  Commerce  Com- 
mission issued  new  rules  changing  several  features  of  the 
statistics  in  order  to  avoid  the  criticisms  advanced,  the 
changes  to  go  into  effect  in  1915.  It  is  this  method  of  statis- 
tical investigation  that  is  recommended  to  be  made  mandatory 
on  Industrial  Commissions. 

The  Industrial  Commissions  herein  recommended  are  mod- 
eled in  part  upon  the  example  of  the  railroad  and  public  utili- 
ties commissions,  the  Interstate  Commerce  Commission,  the 
Federal  Trade  Commission,  and  the  Federal  Reserve  Board. 
Their  powers  are  partly  legislative,  partly  judicial,  and  partly 
executive.  That  which  is  most  important  is  their  power  of 
making  investigations  of  facts  and  conditions  and  then  issuing 
orders  (Paragraph  5)  based  on  such  investigations.  The  leg- 
islature, or  Congress,  lays  down  a  general  policy,  or  standard, 
but  does  not  go  into  all  of  the  minor  details  and  variations  that 
are  needed  to  fit  the  policy  to  actual  conditions.  In  the  case 
of  railroads  it  gives  up  the  attempt  to  enact  a  schedule  of 
freight  and  passenger  rates  and  merely  requires  of  railroad 
corporations  that  all  rates  and  services  shall  be  reasonable, 
that  there  shall  be  no  discriminations,  and  so  on.  The  Com- 
mission then  investigates  each  case  as  it  comes  up  and  issues 
a  detailed  order  intended  to  carry  out  the  policy  and  enforce 
the  standard  laid  down  by  the  legislature  or  Congress.  In  the 
case  of  labor  law  the  legislative  standards  differ  according  to 
the  object  of  the  law.  In  matters  of  safety  the  legislature  re- 
quires employers  to  keep  their  work  places  safe,  and  leaves  to 
the  Commission  the  investigation  of  conditions  and  of  safety 
devices  necessary  to  be  installed  in  each  industry  or  shop,  with 
power  to  order  them  installed.    In  compensation  for  accidents 


345 

the  legislature  requires  the  employer  to  pay  50  per  cent  or 
more  of  the  wages  lost  for  a  certain  time,  and  then  gives  the 
Commission  power  to  investigate  each  case,  if  necessary,  and 
to  determine  exactly  the  amount  and  all  details,  and  to  order 
the  employer  to  pay  that  amount.  Other  standards  may  be  set 
up  by  the  legislature,  if  it  wishes  to  do  so,  for  hours  of  labor, 
minimum  wages,  exclusion  of  women  and  children  from  dan- 
gerous employment,  regulation  of  private  employment  offices, 
and  so  on,  covering  the  entire  field  of  labor  legislation. 

It  is  evident  that  the  legislature  can  not  itself  make  all  of 
these  investigations.  It  must  depend  upon  others.  In  prac- 
tice, too,  the  legislature  and  Congress  are  not  willing  to  de- 
legate to  a  single  executive  official  the  power  of  issuing  rules 
and  orders.  This  power  is  quasi-judicial.  Consequently  the 
legislature  and  Congress  create  commissions  with  three  or 
more  members,  in  order  to  require  deliberation  and  a  fair  rep- 
resentation and  hearing  for  all  interests  that  are  benefited 
by,  or  compelled  to  obey,  the  rules.  A  single  executive  official 
is  liable  to  be  one-sided  and  partisan,  or  to  act  without  delib- 
eration, or  to  be  frequently  changed,  but  a  commission  can  be 
organized  so  as  to  be  impartial,  deliberative,  and  continuous. 

In  the  administration  of  all  other  labor  laws,  such  as  those 
on  industrial  education,  child  labor,  hours  of  labor,  minimum 
wage,  and  so  on,  there  are  points  of  antagonism  and  points  of 
harmony  between  capital  and  labor.  The  points  of  antagon- 
ism are  enlarged  and  exaggerated  when  one  side  or  the  other, 
through  practical  politicians,  controls  the  offices.  The  points 
of  harmony  can  only  be  discovered  by  investigation,  and  the 
investigations  must  be  cooperative  between  employers  and 
unions,  else  neither  side  will  have  confidence  in  the  results. 
The  Industrial  Commission  and  its  subordinate  officials,  of 
course,  have  to  be  depended  on  to  make  the  actual  investiga- 
tions, but  the  provision  in  the  foregoing  recommendation,  that 
all  matters  and  all  proposed  publications  shall  be  submitted  to 
the  Advisory  Council,  representing  the  opposing  interests, 
for  their  advice  and  criticism  but  not  their  veto,  goes  as  far 
as  practicable  towards  securing  that  the  investigations,  con- 


346 

elusions  and  rules  of  the  Commission  and  its  subordinates 
will  have  the  confidence  of  both  si- 

The  particular  recommendation  regarding  investigations 
of  labor  disputes  is  associated  with  a  later  recommendation 
regarding  mediation.  (Paragraph  14.)  While  recommend- 
ing voluntary  mediation,  it  is  recognized  that  strikes  and  lock- 
outs are  of  such  public  importance  that  the  public  is  entitled  to 
accurate  information  regarding  their  causes  and  continuance. 
In  connection  with  its  other  investigations  the  investigation  of 
strikes  and  lockouts  shows  underlying  causes  of  industrial 
unrest  and  the  failure  of  legislation  or  administration  to  rem- 
edy them.  Official  investigations  and  reports  on  those  sub- 
jects have  not  as  a  rule  been  accepted,  because  they  have 
been  colorless  for  fear  of  giving  offense,  or  because  they 
are  conducted  under  the  direction  of  partisans  of  one  side  or 
the  other.  It  is  expected  that  investigations  conducted  under 
the  supervision  of  the  Advisory  Council  will  avoid  the  de- 
fects of  many  official  investigations. 

All  investigations  of  a  general  character,  such  as  those  on 
safety  devices,  wages,  hours,  conditions  of  labor,  and  inter- 
state competition,  should  be  made  by  the  Federal  Commis- 
sion, relieving  the  State  Commissions  or  bureaus  for  their 
work  of  local  investigations,  administration,  and  inspection, 
the  Federal  Commission  to  be  the  central  standardizing 
agency,  leaving  the  State  free  to  adopt  or  reject  the  standards 
(Paragraph  17).  The  investigation  of  interstate  competition 
and  the  effect  of  minimum  wage  laws  will  be  of  use  in  the 
most  difficult  part  of  the  work  of  State  minimum  wage  com- 
missions, which  we  endorse  in  so  far  as  women  and  children 
are  concerned. 

RULES  AND  REGULATIONS. 

5.  The  Commission  to  make  rules  and  regulations  for 
carrying  into  effect  the  provisions  of  the  labor  laws  which  it 
enforces.  This  may  be  done  by  providing,  in  the  industrial 
commission  law  or  otherwise,  for  certain  brief  standards  as 


347 

may  be  determined  by  the  legislature,  for  example,  that  all 
places  of  employment  shall  be  safe  and  sanitary  as  the  nature 
of  the  industry  will  reasonably  permit,  that  no  person  shall 
be  allowed  to  work  for  such  hours  of  labor  or  at  such  times 
as  are  dangerous  to  his  or  her  life,  health,  safety  or  welfare, 
that  employment  offices  shall  give  correct  information,  shall 
not  split  fees,  and  so  on.  Or,  less  preferably,  the  existing 
labor  laws  may  be  retained  or  new  ones  enacted  in  minute 
detail,  and  the  Industrial  Commission  may  be  given  power 
merely  to  make  such  additional  rules  and  regulations  or  varia- 
tions from  the  laws  as  are  necessary  to  give  them  full  effect. 
Rules  to  be  submitted  to  the  Advisory  Council  before  issuing. 

The  method  of  brief  legislative  standards  above  mentioned 
is  adopted  by  most  of  the  States  having  Industrial  Commis- 
sions and  it  is  here  recommended,  but  the  latter  is  the  method 
adopted  in  Xew  York.  The  original  policy  of  American  labor 
legislation  involved  an  attempt  to  cover  in  detail  every  con- 
tingency whicli  might  arise.  This  method  has  proved  itself 
impractical.  It  is  impossible  for  a  legislature  charged  with 
so  many  other  duties  and  having  but  little  time  for  attention 
to  any  of  them,  to  intelligently  provide  in  detail  for  such  mat- 
ters as  the  safeguarding  of  machinery  or  the  regulation  of 
hours  of  labor  and  periods  of  rest  in  hundreds  of  different 
employments  and  under  hundreds  of  different  circumstances. 
Legislation  upon  these  subjects  has  today  reached  the  stage 
long  ago  reached  by  legislation  relating  to  public  health  and 
public  utilities.  The  legislature  can  provide  only  the  general 
standards  and  must  leave  to  administrative  officers  the  duty  of 
"filling  in  details." 

Whether  the  labor  laws  of  a  State  consist  only  of  a  few 
sections,  as  in  Wisconsin,  or  are  a  bulky  law,  as  in  New  York, 
there  still  exists  the  necessity  for  the  further  filling  in  of  de- 
tails, and  if  the  labor  laws  enacted  by  the  legislature  are  at 
all  lengthy,  as  in  Xew  York,  there  exists  the  additional  neces- 
sity of  some  means  for  variations  in  deserving  cases,  either 
by  express  provision  of  the  law  or,  in  the  absence  thereof,  by 


348 

the  tacit  overlooking  of  violations  by  the  officials  charged 
with  the  administration.  This  latter  practice  is  an  opportun- 
ity for  graft  or  favoritism.  A  factory  inspector  goes  into  an 
establishment  and  has  the  power  to  order  changes  amounting 
to  several  thousand  dollars.  He  finds  many  points  where  the 
strict  letter  of  the  law  does  not  apply.  Since  he  is  the  only 
person  who  actually  interprets  the  law  on  the  ground  he  can 
readily  overlook  violations.  But  where  the  laws  do  not  go  into 
details  but  an  Industrial  Commission  determines  the  details 
in  the  form  of  rules  fitted  to  conditions,  the  inspector  no 
longer  has  discretion  in  overlooking  violations.  He  must 
report  all  the  violations  and  the  employer  has  another  remedy 
besides  influencing  the  inspector.  He  can  go  to  the  Commis- 
sion with  a  petition  that  a  different  rule  be  made  to  apply  to 
his  case,  and  the  Commission,  after  a  public  hearing,  may 
grant  or  reject  the  petition,  or  modify  its  rule  for  that  par- 
ticular establishment.  Variations  must  be  made  in  any  case. 
The  difference  is,  that  where  there  is  no  Commission  with 
power  to  make  rules,  the  variations  are  made  in  secret  by  the 
different  inspectors,  while  where  the  Commission  has  this 
power  they  are  made  in  public.     (Paragraph  6.) 

In  the  recommendations  above,  the  briefest  kind  of  a  legis- 
lative standard  is  indicated.  Whatever  its  length,  however, 
the  best  method  of  filling  in  the  details  is  the  same.  It  is  not 
unconstitutional  to  delegate  such  power  to  a  single  individual, 
but  it  is  undesirable  and,  as  already  pointed  out,  impractica- 
ble, to  confer  it  upon  one  person.  The  alternative  is  to  confer 
it  upon  a  board  or  commission.  The  chief  question  arising 
here  is  whether  a  board  shall  be  created  especially  for  this 
purpose  or  whether  one  board  shall  perform  this  duty  to- 
gether with  that  of  administering  the  laws  and  the  rules  and 
regulations  made  by  it.  The  latter  is  the  Industrial  Commis- 
sion recommended.  The  other  method  has  been  tried  in  the 
two  greatest  industrial  States  in  the  Union,  New  York  and 
Pennsylvania,  but  the  former  State  abandoned  it  after  a  two- 
years  trial.  In  New  York  it  was  adopted  two  years  ago  when 
the  Factory  Investigating  Commission  declined  to  take  the 


349 

administration  of  the  labor  department  away  from  a  single 
executive,  but  adopted  a  compromise  through  establishing  an 
industrial  board  of  four  members,  together  with  the  labor 
commissioner  as  chairman,  to  perform  the  rule-making  func- 
tion whether  in  the  form  of  general  rules  or  variations.  While 
the  board  has  done  much  good  work,  there  remains  little  doubt 
that  the  same  work  can  be  performed  even  more  intelligently 
and  effectively  by  a  commission  which  is  also  actively  engaged 
in  administrative  work.  In  both  cases,  the  aid  of  committees 
representing  particular  industries  or  interests  has  been  and 
must  be  largely  relied  upon.  On  the  other  hand,  an  industrial 
board  such  as  formerly  existed  in  New  York  and  still  exists 
in  Pennsylvania,  the  rule-making  duties  of  which  are  solely 
legislative  in  their  nature,  without  power  of  enforcement,  is 
not  much  better  equipped  to  make  such  rules  and  regulations 
than  the  legislature,  except  that  its  number  is  smaller  and  its 
personnel  chosen  particularly  for  this  one  duty. 

The  recommendations  provide  different  methods  of  secur- 
ing uniformity  of  State  and  Federal  legislation  on  various 
subjects  (Paragraph  17,  18).  This  uniformity  has  been  se- 
cured in  the  case  of  railroads  by  exactly  the  same  method  as 
the  one  here  proposed  to  be  made  mandatory.  When  Congress 
enacted  a  law  requiring  safety  couplings  there  were  a  large 
number  of  manufacturers  of  couplings  in  the  market.  Con- 
gress gave  authority  to  the  Interstate  Commerce  Commission 
to  decide  on  the  kind  of  couplings  that  would  accomplish  the 
object  of  securing  safety.  The  Commission  called  in  the  rep- 
resentatives of  the  railroads  and  of  the  railroad  brotherhoods, 
with  the  manufacturers  of  couplings,  and  after  several  confer- 
ences the  present  standards  were  adopted.  Other  standards 
applying  to  railroad  cars  were  also  adopted  in  this  way. 

At  the  present  time  there  is  urgent  need  for  Federal  aid  in 
securing  uniformity  of  safety  devices.  This  can  be  done  to  a 
certain  extent  through  voluntary  cooperation  with  the  States. 
Various  States  with  Industrial  Commissions  are  going  ahead 
with  their  own  standards,  and  there  is  apparently  no  means 
of  securing  uniformity  until  a  Federal  Commission  is  given 


350 

power  to  act.  This  could  be  done  if  the  Federal  Commission 
brought  together  representatives  of  State  factory  inspectors, 
along  with  its  Advisory  Council  of  employers  and  employees, 
and  the  private  national  safety  organizations  mentioned  under 
Paragraph  2.  By  agreeing  on  standards  these  could  be 
adopted  by  every  State  Commission  which  has  power  to  make 
rules.  And  the  Federal  Commission  would  be  merely  a  cen- 
tral standardizing  agency,  leaving  to  the  States  the  volun- 
tary adoption  of  the  standards.  If  it  were  desired  to  go  fur- 
ther, a  Federal  law  granting  to  the  Federal  Industrial  Com- 
mission power  to  set  standards  for  interstate  shipment  of  ma- 
chinery not  equipped  with  the  standard  safety  devices  might 
be  adopted.  Each  method  would  require  a  Federal  Commis- 
sion to  set  standards. 

The  illustration  regarding  safety  is  taken  not  because  that 
is  the  most  important  problem,  but  as  furnishing  an  illustra- 
tion of  possible  methods  applicable  in  other  lines.  Similar 
uniformity  might  be  secured  in  the  regulation  of  private  em- 
ployment offices,  and  other  lines  of  labor  legislation,  as  the 
States  or  Congress  may  determine.  Of  course,  if  the  Con- 
gress enacted  legislation  similar  to  the  Palmer-Owen  child 
labor  bill  the  extreme  step  would  be  taken  of  attempting  to 
force  States  to  come  up  to  Federal  standards.  This  may  be 
necessary  in  some  cases,  but  the  Federal  Industrial  Commis- 
sion affords  methods  of  securing  uniformity  in  some  branches 
of  legislation  by  less  extreme  measures. 

The  courts  have  generally  denied  the  contention  that  this 
delegation  of  power  to  make  rules  and  issue  orders  is  un- 
constitutional as  a  delegation  of  legislative  or  judicial  power, 
and  the  Supreme  Court  of  the  United  States  has  used  the 
term  "administrative"  to  describe  those  powers  which  are 
partly  legislative  or  judicial,  but  are  not  so  exclusively  one 
or  the  other  that  they  may  not  be  properly  conferred  upon  an 
executive  or  administrative  body.  (See  Interstate  Commerce 
Commission  v.  Humboldt  S.  S.  Co.,  224  U.  S.  474;  Pennsyl- 
vania Railway  Co.  v.  International  Coal  Mining  Co.,  230  U.  S. 
184;  Mitchell  Coal  &  Coke  Co,  v.  Pennsylvania  Railway  Co., 
230  U.  S.  274.) 


351 


REVIEW  BY  COMMISSION. 

6.  Any  person  in  interest  to  be  entitled  to  petition  the 
Commission  for  a  hearing  on  the  legality  or  reasonableness  of 
any  rule  or  regulation,  or  of  any  order  directing  compliance 
with  any  provisions  of  law  or  other  rule  or  regulation  or  for 
a  special  order  applicable  to  a  single  establishment.  The 
Commission  may  change  its  rule  or  regulation  before  final 
decision  by  a  court  on  its  legality. 

This  recommendation  is  embodied  in  one  form  or  another  in 
all  of  the  State  commission  laws.  Under  the  prevailing  sys- 
tem of  administering  labor  laws  a  person  affected  by  an  order 
enforcing  an  act  of  the  legislature  has  no  opportunity  to 
object  to  its  constitutionality,  reasonableness  or  validity  ex- 
cept by  awaiting  prosecution  and  submitting  his  objection  as 
a  matter  of  defense.  Not  only  is  this  cumbersome  and  un- 
desirable as  a  matter  of  procedure,  but  it  is  open  to  a  very 
serious  objection  that  it  brings  this  matter  up  often  for  final 
decision  by  a  petty  court,  or  even  before  a  local  magistrate 
or  justice  of  the  peace. 

Not  only  does  a  provision  of  the  sort  here  recommended 
give  the  person  affected  opportunity  to  make  proper  objec- 
tions, but  it  gives  the  Commission  an  opportunity  to  recon- 
sider its  rules  and  orders  from  the  point,  of  view  of  their 
actual  application  in  concrete  cases  before  they  are  subjected 
to  tests  in  the  courts.  Questions  arising  in  the  application 
of  rules  and  orders  to  concrete  cases  frequently  depend  upon 
facts  and  conditions  which  are  difficult  to  bring  out  accurately 
and  thoroughly  in  the  courts.  The  proceedings  before  the 
Commission  will  develop  the  facts  and  conditions  which  are 
alleged  to  justify  the  provision  and  those  which  the  employer 
depends  upon  to  defeat  it,  better  than  could  be  done  in  any 
court.  It  is  frequently  necessary  for  the  court  to  have  such 
facts  available  in  order  to  arrive  at  a  proper  decision  upon 
the  constitutionality  of  such  a  rule  or  order,  and  in  the  absence 


352 

of  such  a  proceeding  as  this,  an  appellate  court  has  practic- 
ally no  means  of  obtaining  such  information.  This  could  not 
be  better  illustrated  than  in  the  recent  decision  of  the  New 
York  Court  of  Appeals  (People  v.  Schiveinler  Press,  214 
N.  Y.  395),  upholding  the  constitutionality  of  the  section  of 
the  labor  law  prohibiting  night  work  for  women,  and,  in  effect, 
overruling  its  own  decision  of  eight  years  previous,  holding 
a  similar  provision  unconstitutional.  In  the  opinion  of  the  re- 
cent case  the  court  frankly  says  that  its  previous  decision 
was  due  to  a  lack  of  proof  at  that  time  that  the  prohibition 
bore  some  direct  relation  to  the  public  health  and  welfare,  and 
that  subsequently  such  proof  had  been  gathered  and  was  of 
such  a  nature  as  to  warrant  a  different  decision.  In  this  case 
the  evidence  had  been  gathered  largely  through  the  efforts  of 
a  special  factory  investigating  commission,  but  the  whole  in- 
cident illustrates  the  necessity  for  a  thorough  consideration 
of  all  facts  involved  before  the  matter  is  taken  into  the  courts, 
and  making  the  results  of  such  consideration  available  for  the 
use  of  the  courts. 

The  special  order  applicable  to  a  single  establishment  is  nec- 
essary in  order  to  take  into  account  peculiar  conditions,  which, 
if  rigidly  applied,  might  render  the  entire  law  or  general  rule 
unconstitutional. 

COURT  REVIEW. 

7.  Any  person  in  interest  to  be  entitled  to  bring  a  special 
action  in  court  to  test  the  legality  and  reasonableness  of  any 
provision  of  the  labor  laws,  of  any  rules  and  regulations  made 
thereunder,  or  of  any  order  directing  compliance  therewith. 
(It  is  probably  advisable,  in  the  case  of  State  commissions,  to 
limit  the  jurisdiction  of  such  cases  to  a  court  sitting  at  the 
State  capitol.)  Actions  involving  rules  and  regulations  and 
orders  not  to  be  brought  until  final  determination  of  the  peti- 
tions for  review  (Paragraph  6)  by  the  Commission.  Pro- 
vision also  to  be  made  for  suspending  prosecutions  pending 


353 

determination  of  petitions  or  actions  for  review  in  court. 
Matters  of  fact  which  had  not  been  before  the  Commission 
to  be  referred  back  to  the  Commission  and  opportunity  given 
for  the  Commission  to  change  its  rules  or  regulations  before 
final  decision  by  the  court.  Rules  and  regulations  of  the 
Commission  to  be  made  prima  facie  reasonable  in  all  court 
proceedings. 

This  recommendation  is  provided  for  in  different  ways  in 
the  different  State  commission  laws.  The  purpose  of  these 
provisions,  together  with  those  relating  to  review  by  the  Com- 
mission (Paragraph  6),  is  to  secure  a  uniform  interpreta- 
tion of  the  labor  laws  and  the  rules  and  regulations  for  carry- 
ing them  into  effect;  to  prevent  their  being  held  unconstitu- 
tional by  petty  courts  (which  often  results,  on  account  of  the 
impossibility  of  appealing  such  a  decision,  in  an  absolute  bar 
to  further  enforcement  of  such  provisions  in  that  locality,  even 
though  the  provisions  may  eventually  be  upheld  by  a  higher 
court) ;  and  to  protect  the  Commission  from  ill-considered 
action  by  higher  courts  not  having  before  them  sufficient  in- 
formation to  enable  them  to  arrive  at  an  intelligent  decision. 

TESTIMONY. 

8.  The  Commission  to  have  the  incidental  powers  such  as 
those  of  subpoenaing  and  examining  witnesses  and  adminis- 
tering oaths,  and  so  on,  necessary  for  the  full  performance  of 
duties  imposed  upon  it.  These  powers,  however,  to  be  strictly 
limited  to  those  branches  in  which  the  Commission,  on  the 
basis  of  experience  or  the  constitutional  rules  regarding  evi- 
dence, finds  them  indispensable.  In  all  other  work  the  Com- 
mission to  have  no  powers  of  compulsory  examination  and 
so  on. 

The  powers  of  compulsory  investigation  and  public  hearings 
are  liable  to  serious  abuse  in  order  to  gain  some  temporary 


354 

publicity  or  personal  advantage,  but  in  practice  it  is  found 
that  competent  investigators  and  informal  conferences,  such 
as  those  of  the  proposed  advisory  councils,  can  secure  more 
valuable  and  reliable  information  than  when  individuals  are 
placed  on  the  stand  and  required  to  talk  to  the  stenographer. 

CONTINUOUS  INDUSTRY,  EMPLOYMENT 
AND  INSURANCE. 

9.  In  all  industries  or  occupations  operating  continuously 
day  and  night  and  seven  days  a  week  the  legislatures  or 
Congress  should  enact  laws  requiring  three  shifts  of  eight 
hours  each  and  one  day  of  rest  in  seven,  or  their  equivalent, 
administered  under  rules  of  an  Industrial  Commission  laid 
down  for  each  industry  or  establishment  as  may  be  required. 

This  class  of  legislation  has  been  widely  adopted  in  Euro- 
pean countries  but  has  been  found  unenforceable  without  the 
aid  of  an  administrative  body  competent  to  take  into  account 
the  many  differences  of  different  establishments.  In  those 
countries  hundreds  of  different  rules  are  issued  for  different 
industries.  For  example,  the  rules  for  Pullman  employees 
would  differ  materially  from  those  for  steel  mills  or  hotels.  We 
consider  such  laws  unenforceable  without  this  provision,  and 
its  enforcement  can  not  be  secured  without  a  Commission  un- 
der the  supervision  of  a  Representative  Council  such  as  we 
recommend. 

The  Industrial  Commission,  with  its  Advisory  Council,  in  its 
administration  of  employment  bureaus  is  evidently  the  body 
to  work  out  improvements  not  only  in  the  bureaus  themselves 
but  in  measures  designed  to  provide  for  the  unemployed  or 
to  regularize  employment,  such  as  workmen's  hotels,  or  ad- 
vice to  Federal,  State,  and  municipal  authorities  for  shifting 
their  work  to  the  winter  months  or  to  periods  of  depression. 
These  matters  have  been  remarkably  provided  for  in  Ger- 
many, where  the  emplovment  bureaus,  with  their  Advisory 


355 

Councils,  have  become  the  most  effective  of  those  in  any 
country. 

Such  measures  as  sickness  insurance,  invalidity  insurance 
and  unemployment  insurance  evidently  require  a  large  amount 
of  investigation  before  they  can  be  recommended.  Their  prin- 
cipal object  should  be  the  cooperation  of  employers  and  em- 
ployees in  the  prevention  of  sickness,  invalidity  and  unem- 
ployment. Their  administration  and  the  drafting  of  laws  and 
rules  will  evidently  have  to  be  entrusted  to  a  Commission 
with  such  an  Advisory  Council  as  is  proposed. 

POLICE  AND  MILITARY. 

10.  That  such  detective  agencies  as  may  operate  in  more 
than  one  State,  or  be  employed  by  industrial  corporations  en- 
gaged in  interstate  commerce,  or  which  may  use  the  mails, 
shall  be  compelled  to  take  out  a  Federal  license,  under  the 
Industrial  Commission,  with  regulations  that  will  insure  the 
character  of  their  employees  and  the  limitation  of  their  activi- 
ties to  the  bona  fide  business  of  detecting  crime.  Similar  li- 
cense and  regulation  for  all  private  employment  offices  en- 
gaged in  interstate  business. 

That  all  enterprises  shall  be  forbidden  the  right  to  employ 
private  armed  guards,  except  as  watchmen  on  the  premises,  or 
to  have  such  watchmen  deputized  as  police  except  where  such 
is  found  necessary  by  the  State  or  Federal  Industrial  Com- 
mission. That  rules  adapted  to  the  differences  required  by 
various  industries  should  be  made  by  the  Industrial  Commis- 
sion, in  order  to  carry  these  laws  into  effect. 

That  such  enterprises  shall  exercise  their  right  to  call  upon 
the  constituted  authorities  to  furnish  them  with  the  necessary 
protection  to  their  property,  and  to  the  lives  of  their  workers, 
against  the  threatened  attack  of  rioters  or  strikers ;  and  that 


356 

it  shall  be  incumbent  upon  the  constituted  authorities  to  fur- 
nish such  protection  in  the  way  of  police  or  deputy  sheriffs, 
and  that  a  failure  on  their  part  to  do  this  shall  lay  the  political 
subdivision  in  which  such  damage  to  life  or  property  may 
take  place,  liable  to  damages.  That  all  individuals  denied  their 
constitutional  rights  of  habeas  corpus,  free  access  to  public 
highways,  free  speech,  etc.,  shall  have  similar  power  of  action 
in  damages  against  the  political  division  in  which  such  de- 
nial takes  place.  That  all  highways  now  claimed  as  private 
property  shall  be  made  public. 

That  the  militia  of  the  several  States  being  subject  to  reg- 
ulation by  Congress,  carefully  drawn  rules  for  their  personal 
organization  and  conduct  in  the  field  shall  be  drawn  up  by 
the  War  Department,  after  conference  with  the  Industrial 
Commission  and  Advisory  Council,  and  that  all  parties  ar- 
rested by  the  militia  during  the  time  of  troubles  shall  be 
turned  over  for  trial  to  the  civil  authorities.  Similar  rules 
should  be  drawn  up  by  State  authorities  with  the  cooperation 
of  the  State  Industrial  Commission  and  its  Advisory  Council 
for  the  regulation  of  State  constabulary.  The  War  Depart- 
ment with  the  aid  of  the  Industrial  Commission  and  Advisory 
Council  should  investigate  and  recommend  legislation  regard- 
ing the  shipment  of  arms  and  guards  in  interstate  commerce. 

One  of  the  principal  reasons  why  corporations  are  com- 
pelled to  employ  private  guards  is  the  failure  of  the  taxpay- 
ers to  provide  them.  This  is  also  one  of  the  principal  reasons 
why  laborers  and  labor  organizers  are  denied  their  constitu- 
tional rights.  Taxpayers  take  little  part  in  the  elections  or 
otherwise  to  provide  officials  competent  to  and  willing  to  pro- 
tect the  rights  both  of  capital  and  labor,  because  the  invasion 
of  these  rights  does  not  affect  them.  This  would  be  changed 
if  the  political  subdivision  were  made  liable  in  damages.  Yet 
it  is  not  proper,  as  has  been  done  in  some  States,  to  provide 


357 

for  protection  of  property  in  this  way  without  providing  also 
for  protection  of  labor  in  the  same  way.  Laws  designed  to 
regulate  deputy  sheriffs  or  the  police  force  can  not  be  made 
effective  under  our  system  of  local  government  without  liabil- 
ity of  taxpayers  for  violation. 

The  drafting  of  rules  for  the  conduct  of  militia  or  State  con- 
stabulary should  not  be  left  entirely  to  military  authorities 
but  should  be  drafted  with  the  joint  discussion  and  advice  of 
employers  and  employees,  who  are  more  directly  affected 
than  other  classes  in  the  community.  It  is  not  intended  that 
the  Industrial  Commission  or  Advisory  Council  shall  have  a 
veto  on  any  regulations  issued  by  the  military  or  police  au- 
thorities, but  they  should  have  opportunity  for  criticism  and 
advice.  The  entire  subject  of  policing  industry  has  not  been 
sufficiently  investigated  from  all  points  of  view,  and  more  spe- 
cific recommendations  than  these  can  not  now  be  endorsed.  It 
is  therefore  recommended  above  that  further  investigations 
from  all  points  of  view  should  be  referred  to  the  proper  Fed- 
eral and  State  authorities,  assisted  by  the  representatives  of 
all  interests  affected. 

LEGAL  AID. 

11.  State  Commissions  (and  perhaps  the  Federal  Commis- 
sion) should  render  aid  and  assistance  to  deserving  workmen 
in  the  adjustment  of  disputes  other  than  collective  disputes, 
and  the  recovery  of  claims  arising  out  of  their  relations  with 
their  employers,  and  generally  take  such  action  as  may  be 
necessary  for  the  protection  of  employees  from  fraud,  extor- 
tion, exploitation  and  other  improper  practices.  For  this  pur- 
pose the  Commission  to  be  authorized  to  assign  members  of 
its  staff  to  appear  in  justice  and  other  courts  which  adjudicate 
such  claims,  and  to  create  local  Advisory  Committees  of  em- 
ployers and  employees  to  pass  upon  all  such  claims  in  co- 
operation with  the  deputy  of  the  Commission,  and  in  advance 
of  court  procedure. 


358 

This  recommendation  has  been  partly  adopted  in  the  New 
York  act.  An  examination  of  the  reports  of  existing  public 
agencies  of  this  sort  and  of  the  legal  aid  societies  of  the  large 
cities  of  this  country  shows  that  by  far  the  largest  single  class 
of  cases  with  which  they  are  called  upon  to  deal  is  the  adjust- 
ment of  small  wage  claims.  In  some  communities  there  al- 
ready exist  municipal  and  other  so-called  "poor  men's" 
courts  and  "small  debtors'  courts,"  intended  especially  for 
the  speedy  settlement  of  small  claims  and  disputes;  but  even 
the  best  of  these  courts  are  scarcely  sufficient  in  themselves  to 
meet  the  situation  which  confronts  many  employees.  In  some 
of  them  a  very  large  proportion  of  disputes  over  small  wage 
claims,  in  some  instances  as  high  as  90  per  cent,  can  be  settled 
if  the  two  parties  can  only  be  brought  together  under  con- 
ditions which  make  it  certain  that  if  a  settlement  is  not  made 
there  is  someone  standing  back  of  deserving  claimants  ready 
to  push  their  cases. 

Then,  too,  these  cases  frequently  involve  a  general  practice 
from  which  many  individuals  suffer,  and  yet  it  is  impractical 
for  any  one  of  them  to  take  the  necessary  action  to  secure  re- 
dress or  put  an  end  to  the  practice.  Members  of  a  given  class 
are  often  made  the  victims  of  exploitation  or  improper  prac- 
tices under  conditions  where  it  is  not  practical  nor  worth 
while  for  any  individual  to  fight  the  matter  out,  and  yet  where 
the  aggregate  loss  to  the  class  is  considerable.  The  ordinary 
shipper  is  generally  able  to  pay  for  necessary  legal  services 
and  still  Congress  and  a  number  of  the  State  legislatures  have 
required  the  Interstate  Commerce  Commission  and  the  State 
Commissions  to  render  just  such  aid  to  shippers  having  claims 
against  railroads,  because  of  the  economic  disadvantage  in 
which  an  individual  shipper  is  placed  in  a  contest  with  the 
railroads.  That  employees  stand  in  need  of  such  protection 
from  the  State  is  evidenced  by  the  mass  of  labor  legislation 
which  has  been  enacted  and  the  agencies  which  have  been 
created  for  its  administration. 

Nor  does  such  provision  lack  precedents  other  than  the 
railroad  legislation  already  referred  to.    For  some  years  the 


359 

Bureau  of  Industry  and  Immigration  of  the  New  York  Labor 
Department  has,  in  cooperation  with  the  New  York  Legal  Aid 
Society,  extended  just  such  assistance  to  immigrants,  and 
almost  the  exact  provision  here  recommended  has  been  in- 
cluded in  the  industrial  commission  law  just  enacted  in  New 
York. 

Kansas  City  maintains  its  own  legal  aid  bureau  as  part  of 
the  city  government,  and  of  the  five  or  six  thousand  cases  a 
year  handled  by  it,  almost  half  are  wage  claims.  The  largest 
class  of  cases  handled  by  the  public  defender  of  Los  Angeles 
is  wage  claims. 

The  above  recommendation  is  intended  to  establish  in  the 
United  States  a  system  analogous  to  the  industrial  courts  of 
France,  Germany  and  other  European  countries.  But  it  can 
not  be  expected  that  many  localities  will  initiate  this  class  of 
courts,  and  it  will  require  a  State  Commission  to  make  them 
general.  If  municipalities  were  given  authority  and  then 
actually  established  such  courts,  the  State  Commission  would 
withdraw. 

LEGISLATION. 

12.  The  Industrial  Commission,  upon  request  of  the  legis- 
lature or  Congress,  or  the  committee  on  relations  between 
capital  and  labor,  to  investigate  a  subject  and  draft  bills.  The 
Commission  to  make  recommendations  regarding  legislation 
affecting  subjects  under  its  jurisdiction. 

It  is  not  proposed  that  the  Industrial  Commission  shall 
initiate  legislation  or  make  recommendations  except  on  laws 
previously  assigned  to  it  for  administration.  Matters  outside 
its  jurisdiction  would  bring  it  into  the  political  and  controver- 
sial field.  Yet  when  Congress  or  the  legislature  is  considering 
new  legislation,  such  as  sickness  insurance,  unemployment  in- 
surance, and  so  on,  it  might  refer  the  matter,  in  its  own  dis- 
cretion, for  further  investigation  and  recommendation.  Ad- 
vanced legislation  is  fought  out  by  lobbies  and  in  committees, 


360 

and  the  advantage  of  reference  to  the  Industrial  Commission 
would  be  the  cooperation  of  its  Advisory  Council  in  drafting 
a  workable  law,  eliminating  u  jokers",  and  carrying  out  the  in- 
tent of  the  legislature.  At  present  there  is  no  definite  means 
provided  whereby  lobbyists  can  be  required  to  come  together 
and  confer  regarding  measures.  They  appear  usually  as  an- 
tagonists or  lawyers  before  legislative  committees,  and  not 
as  the  conferees  of  an  Advisory  Representative  Council.  This 
proposition  is  by  no  means  a  novel  or  untried  one.  After 
fruitless  administration  of  the  impractical  coal  mining  laws, 
which  had  been  placed  on  the  statute  books  mainly  by  the 
labor  unions  of  Illinois  and  Colorado,  the  legislature  turned 
the  matter  of  revising  the  mining  code  over  to  a  joint  commit- 
tee selected  by  the  coal  operators  and  the  mine  workers' 
union,  and  then  enacted  into  law,  without  amendment,  the  code 
which  the  two  opposing  interests,  in  conference  with  the  leg- 
islative committee,  jointly  recommended.  The  advisory  com- 
mittee on  apprenticeship  of  the  Wisconsin  Commission  has 
recently  agreed  upon  an  apprenticeship  law  satisfactory  to 
employers,  trade  unions,  and  the  Commission,  and  this  was 
adopted  by  the  legislature  without  change.  This  method  of 
legislation  can  be  indefinitely  extended  to  all  matters,  with  the 
result  that,  while  both  sides  protect  their  own  interests,  they 
often  eventually  reach  agreement  on  points  where  their  in- 
terests and  those  of  the  public  are  common. 

This,  of  course,  does  not  do  away  with  the  final  authority 
of  Congress  or  the  legislature,  nor  with  the  battle  of  opposing 
interests  in  the  legislative  branch  of  Government  where  they 
have  not  been  able  to  agree,  nor  where  other  interests  are 
affected.  Here  is  the  proper  place  for  the  lobbyists  of  both 
sides  to  endeavor  to  get  the  support  of  representatives  of  the 
people,  and  to  override  the  other  side.  There  could  not  be 
much  of  the  advanced  legislation  required  to  meet  the  prob- 
lems of  capital  and  labor  without  a  struggle  in  the  legislature 
or  Congress  on  new  issues.  But  when  the  legislature  is  ready 
to  take  an  advanced  step,  it  is  an  advantage  to  require  the 
combatants  to  confer  on  the  details  and  to  subject  their  dif- 


361 

ferences  to  investigation  by  an  impartial  body  on  which  they 
have  representation.  This  advantage  is  intended  in  the  above 
recommendation. 

SUPREME  COURTS. 

13.  At  the  request  of  the  Supreme  Court  (State  or  Fed- 
eral) the  Industrial  Commission  shall  investigate  and  report 
upon  any  questions  of  fact  referred  to  it  by  the  court  and 
bearing  upon  the  constitutionality  or  reasonableness  of  any 
Federal  or  State  statute  or  administrative  rule  on  the  rela- 
tions of  employer  and  employee.  Amendment  of  the  Judica- 
ture Act  so  as  to  permit  a  State  to  appeal  from  its  own 
Supreme  Court  to  the  Federal  Supreme  Court  on  a  decision 

against  a  State  based  on  conflict  with  the  Federal  Consti- 
tution. 

While  the  principles  of  law  are  held  to  be  settled  and  un- 
changeable, their  applications  change  when  conditions  change. 
Decisions  of  the  courts  on  the  constitutionality  of  labor  laws 
often  turn  on  the  information  which  is  placed  before  the  court 
as  to  the  necessity  of  the  lawT.  The  Supreme  Court  declared 
an  eight-hour  law  for  miners  constitutional  and  a  ten-hour 
law  for  bakers  unconstitutional  largely  because  it  was  fur- 
nished with  conclusive  information  on  conditions  in  the  mines 
but  not  in  the  bakeries.  (H  olden  v.  Hardy,  1898, 169  U.  S.  366 ; 
Lochner  v.  New  York,  1907,  198  U.  S.  45.)  The  court  of  New 
York  in  1907  declared  (People  v.  Williams,  189  N.  Y.  131)  a 
law  prohibiting  night  work  for  women  unconstitutional,  but 
held  a  similar  law  constitutional  in  1915  {People  v.  Schweinler 
Press,  214  N.  Y.  395),  and  gave  as  the  reason  for  its  change 
of  opinion  the  evidence  placed  before  it  in  the  second  case. 
The  court  said  in  1915 : 

JT.  It  is  urged  that  whatever  might  be  our  original 
views  concerning  this  statute,  our  decision  in  People  v. 
Williams  (1907)  is  an  adjudication  which  ought  to  bind 
us  to  the  conclusion  that  it  is  unconstitutional.    While  it 


362 

may  be  that  this  argument  is  not  without  an  apparent 
and  superficial  foundation  and  ought  to  be  fairly  met,  I 
think  that  a  full  consideration  of  the  Williams  case  and 
of  the  present  one  will  show  that  they  may  be  really  and 
substantially  differentiated,  and  that  we  should  not  be 
and  are  not  committed  by  what  was  said  and  decided  in 
the  former  to  the  viewr  that  the  Legislature  had  no  power 
to  adopt  the  present  statute.     *     *     * 

While  theoretically  we  may  have  been  able  to  take 
judicial  notice  of  some  of  the  facts  and  some  of  the  legis- 
lation now  called  to  our  attention  as  sustaining  the  belief 
and  opinion  that  night  work  in  factories  is  widely  and 
substantially  injurious  to  the  health  of  women,  actually 
very  few  of  these  facts  were  called  to  our  attention,  and 
the  argument  to  uphold  the  law  on  that  ground  was  brief 
and  inconsequential. 

Especially  and  necessarily  was  there  lacking  evidence 
of  the  extent  to  which  during  the  intervening  years  the 
opinion  and  belief  have  spread  and  strengthened  that  such 
night  work  is  injurious  to  women;  of  the  laws,  as  indi- 
cating such  belief,  since  adopted  by  several  of  our  own 
States  and  by  large  European  countries,  and  the  report 
made  to  the  Legislature  by  its  own  agency,  the  Factory 
Investigating  Commission,  based  on  investigation  of 
actual  conditions  and  study  of  scientific  and  medical  opin- 
ion that  night  work  by  women  in  factories  is  generally  in- 
jurious and  ought  to  be  prohibited. 

Other  illustrations  might  be  given,  showing  the  way  in 
which  courts  respond  to  the  needs  of  progressive  legislation 
when  once  they  have  before  them  ascertained  facts.  Investi- 
gations by  attorneys  or  interested  parties  may  have  a  certain 
weight  in  court,  but  the  weight  can  not  be  as  great  as  the  in- 
vestigations and  findings  of  an  impartial  Commission,  super- 
vised by  representatives  of  the  interests  affected  by  the  de- 
cision. Criticism  of  the  courts  for  decisions  overturning  laws 
designed  to  protect  labor,  and  the  demands  for  constitutional 


363 

amendments  depriving  the  court  of  power  to  declare  laws 
unconstitutional,  or  providing  for  recall  of  decisions  or  recall 
of  judges,  often  fail  to  reach  the  real  difficulty.  The  difficulty- 
is  that  bureaus  or  departments  of  labor  and  statistics  have 
been  so  incompetently  managed  or  their  investigations  so  re- 
mote from  the  concrete  facts  that  need  to  be  established,  that 
the  courts  have  had  no  reliable  information  and  have  been 
compelled  to  fall  back  on  their  own  meager  information  or 
"common  knowledge."  If  the  court  had  at  hand  a  reliable 
and  well  equipped  referee  with  power  to  get  the  facts,  as  in 
the  Industrial  Commission,  it  is  probable  that  it  would  call 
upon  such  referee  instead  of  basing  its  judgment  on  the 
doubtful  claims  and  technical  arguments  of  attorneys. 

It  will  be  noted,  however,  that  this  recommendation  is  mere- 
ly supplementary  to  those  in  Paragraphs  6  and  7.  In  those 
paragraphs  the  rules  and  regulations  of  the  Commission  itself, 
dealing  with  labor  conditions,  are  tested  before  the  court  and 
they  are  made  prima  facie  valid  and  reasonable  as  based  on 
adequate  investigation.  The  present  recommendation  is  op- 
tional with  the  court,  and  may  pertain  to  an  act  of  the  legisla- 
ture or  the  rule  of  an  administrative  body  upon  which  the 
court  is  not  reliably  informed  as  to  the  facts. 

A  provision  similar  to  this  is  included  in  the  recent  Federal 
Trade  Commission  Act  (Sec.  7). 

The  recommendation  for  amendment  by  Congress  of  the 
Judicature  Act  is  based  on  the  fact  that  private  individuals 
or  corporations  can  now  appeal  to  the  Federal  courts  if  the 
decision  of  the  State  court  is  against  them,  on  the  ground  of 
conflict  with  the  Federal  Constitution,  but  the  State  itself  can 
not  appeal  if  its  own  State  court  has  decided  against  the 
State  on  the  ground  that  the  State  law  conflicts  with  the  Fed- 
eral Constitution.  It  is  sufficient  that  a  State  court  should 
decide  issues  under  the  State  Constitution,  but  the  Federal 
Supreme  Court  alone  should  decide  finally  all  issues  under  the 
Federal  Constitution.  With  the  provision  that  the  Supreme 
Court  should  require  the  Industrial  Commission  to  investigate 
and  report  upon  the  facts  which  are  alleged  to  justify  the  State 


364 

legislation  in  question,  the  way  is  prepared  for  the  Supreme 
Court  to  have  before  it  the  economic  and  social  facts  neces- 
sary to  pass  intelligently  upon  these  questions  of  constitu- 
tionality. 

MEDIATION  AND  MINIMUM  WAGE. 

14.  The  Industrial  Commission  (State  or  Federal)  shall 
appoint,  remove  and  fix  the  compensation  of  a  Chief  Mediator 
of  Industrial  Disputes.  The  Chief  Mediator  to  hold  his  po- 
sition until  removed  by  the  Industrial  Commission,  and  to  ap- 
point such  assistants  as  may  be  needed,  and  to  fix  their  com- 
pensation with  the  approval  of  the  Industrial  Commission. 
He  should  appoint  temporary  mediators  for  special  cases, 
without  requiring  them  to  give  up  their  private  business  or 
offices. 

The  Chief  Mediator  and  all  assistant  mediators  to  be  se- 
lected from  an  eligible  list  prepared  by  the  Civil  Service  Com- 
mission on  a  nonassembled  examination,  with  the  assistance  of 
the  Industrial  Commission  and  the  Advisory  Council. 

The  Chief  Mediator  and  his  staff  to  have  no  powers  what- 
ever of  compulsory  testimony  and  to  be  prohibited  from  arbi- 
trating any  dispute,  from  making  any  public  recommendation, 
or  from  revealing  in  any  way,  directly  or  indirectly,  any  in- 
formation which  they  may  have  secured  from  any  parties 
relative  to  an  industrial  dispute.  Any  violation  to  be  suffi- 
cient ground  for  immediate  removal  by  the  Industrial  Com- 
mission. The  powers  of  the  mediators  to  be  those  solely  of 
voluntary  mediation  or  conciliation,  but  the  Chief  Mediator 
shall  offer  his  services  in  confidence  to  both  sides  of  a  dispute 
which,  in  his  judgment,  is  of  public  importance. 

The  Chief  Mediator  and  his  staff  to  be  wholly  independent 
of  the  Industrial  Commission,  except  as  to  appointment  and 


365 

removal,  to  the  extent  that  they  be  prohibited  from  reporting 
any  facts  or  recommendations  whatever  to  the  Industrial  Com- 
mission or  any  other  authority,  relative  to  the  merits  of  any 
industrial  dispute. 

In  case  the  Mediator  is  unable  to  secure  an  agreement 
through  conciliation,  he  shall  recommend  arbitration  to  both 
parties,  and  if  both  consent  to  abide  by  the  decision  of  arbitra- 
tors he  shall  proceed  to  assist  them  in  selecting  a  board  of  ar- 
bitration in  any  way,  and  consisting  of  any  number  of  mem- 
bers, that  both  sides  may  agree  upon.  If  agreement  is  not 
reached  within  a  specified  time  on  the  third  party  to  the  board 
of  mediation,  the  Chief  Mediator  shall  appoint  the  same. 

In  case  both  parties  do  not  consent  to  arbitration  the  Medi- 
ator shall  recommend  the  appointment  of  a  Board  of  Media- 
tion and  Investigation,  which  shall  have  power  to  make  pub- 
lic its  findings  and  recommendations,  but  such  recommenda- 
tions shall  not  be  binding  on  any  person.  If  both  parties  shall 
consent  to  such  a  board  the  Mediator  shall  assist  them  in 
creating  the  same,  and  shall  appoint  the  third  member  if  the 
parties  can  not  agree  on  the  same  within  a  specified  number 
of  days. 

In  case  both  parties  accept  either  a  Board  of  Arbitration 
or  a  Board  of  Mediation  and  Investigation,  such  board,  as 
the  case  may  be,  shall  have  power  of  compelling  testimony. 
The  "Newlands  Act"  and  the  Department  of  Labor  act  should 
be  so  amended  that  all  mediation  and  conciliation,  whether  on 
railways  or  in  other  industries,  shall  be  consolidated  under  the 
Mediator  of  the  Federal  Industrial  Commission.  The  Fed- 
eral Commission  should  cooperate  with  State  mediators. 

In  the  case  of  women  and  children,  minimum  wage  boards 
should  be  created  by  the  State  Industrial  Commissions. 

The  foregoing  recommendation  is  intended  to  provide  for 


366 

strictly  "voluntary"  methods  of  mediation  and  arbitration. 
When  engaged  in  this  branch  of  its  work  the  Commission  is 
not  only  prohibited  from  using  its  compulsory  powers,  but  its 
mediation  work  is  so  rigidly  separated  from  its  other  work 
that  it  can  not  even  be  suspected  of  using  the  coercive  power 
of  Government  to  favor  either  side.  The  Mediator  and  his 
staff  are  to  be  strictly  confidential  advisers  to  the  opposing 
interests,  without  the  power  of  Government,  or  even  the  threat 
of  using  that  power,  to  coerce  either  side  of  a  collective  dis- 
pute. If  coercion  is  used  in  the  form  of  "compulsory  testi- 
mony" it  is  only  with  the  previous  voluntary  consent  of  both 
sides. 

The  reasons  for  reaching  this  conclusion,  and  for  recom- 
mending that  in  other  branches  of  its  work  the  proposed  Com- 
mission shall  have  the  ordinary  coercive  powers  of  Govern- 
ment, are  based  on  the  fundamental  distinction  between  col- 
lective bargaining  and  the  individual  labor  contract.  The 
principle  in  general  is,  that  Government  should  not  employ  its 
coercive  powers  to  regulate  collective  bargaining,  but  should, 
in  certain  matters,  employ  the  force  of  law  and  administra- 
tion to  regulate  the  individual  labor  contract.  It  does  the  lat- 
ter through  laws  on  child  labor,  hours  of  labor,  safety  and 
health,  workmen's  compensation,  sickness  insurance,  mini- 
mum wage,  and  so  on. 

Collective  bargaining,  in  its  last  analysis,  is  based  upon  the 
coercive  power  of  antagonistic  classes  organized  for  aggres- 
sion and  defense.  The  bargaining  power  of  either  side  is  the 
power  to  use  the  strike  against  the  lockout,  the  boycott  against 
the  blacklist,  the  picket  against  the  strikebreaker,  the  closed 
union  shop  against  the  closed  nonunion  shop,  and  so  on.  These 
are  essential  weapons,  and  no  plausible  verbiage  or  double 
meaning  of  words  should  blind  us  to  the  fact  that  these  wea- 
pons are  coercive,  and  are  intended  to  be  coercive,  and,  in  the 
last  analysis,  will  be  used,  secretly  or  openly,  as  coercive,  by 
either  side.  Their  object  is  similar  to  legislation  regulating 
the  individual  labor  contract  except  that  they  regulate  it 
through  joint  agreement  backed  by  their  coercive  weapons, 
instead  of  fines  and  imprisonment. 


367 

The  question  then  is,  Shall  the  coercive  power  of  Govern- 
ment be  used  to  deprive  one  side  or  the  other,  or  both  sides, 
of  any  or  all  of  their  coercive  weapons  designed  to  control  the 
individual  labor  contract! 

The  most  extreme  use  of  this  power  is  known  as  compul- 
sory arbitration.  Here  the  Government  attempts  to  deprive 
both  sides  of  all  coercive  weapons  by  completely  prohibiting 
strikes,  lockouts,  boycotts,  blacklists,  picketing  and  strike- 
breaking, and  by  preventing  either  side  from  using  its  meth- 
ods of  strategy  designed  to  overcome  the  other  side. 

But  the  Government  may  use  its  coercive  power  to  deprive 
either  side  of  only  a  part  of  its  weapons  or  strategies.  Arbi- 
tration, or  a  joint  agreement,  consists  of  several  steps,  and 
at  each  step  each  side  either  employs  its  weapons  or  else  re- 
sorts to  strategy  in  order  to  play  for  position  and  to  gain  an 
advantage  when  it  comes  to  using  the  weapons. 

The  first  step  in  the  strategy  of  collective  bargaining  is 
recognition  of  the  union,  that  is,  recognition  by  the  employer 
of  the  representatives  of  the  union  by  consenting  to  confer 
with  them.  How  important  this  preliminary  step  is  consid- 
ered by  both  sides  is  shown  by  the  meaning  which  they  give 
to  the  term  'recognition."  To  " recognize  a  union"  is  con- 
sidered to  be  not  to  merely  hold  a  conference  with  its  agents, 
but  also  to  investigate  grievances  and  demands,  to  negotiate 
concerning  the  terms  of  a  collective  agreement,  and  even  to 
employ  union  men  on  terms  consented  to  by  the  union.  Strictly 
speaking,  these  are  not  "recognition,"  but  are  steps  in  col- 
lective bargaining  that  follow  recognition.  Recognition  in  the 
ordinary  use  of  the  term  (the  one  here  used)  would  be  merely 
a  conference  in  which  the  employer  meets  certain  individuals, 
not  as  individuals  but  as  recognized  agents  of  the  union  au- 
thorized to  speak  on  behalf  of  his  employees.  But  it  is  so  well 
understood  that  recognition,  even  in  this  limited  sense,  will 
be  followed  by  other  steps,  that  the  decisive  battle  is  often 
fought  out  at  this  point.  The  employer  knows  that,  if  he 
meets  the  leaders,  the  union  has  gained  an  advantage.  He 
has  acknowledged  to  all  nonunionists  and  timid  unionists  in 


368 

his  shop  that  the  union  is  something  he  can  not  ignore,  and  this 
is  a  flag  of  truce  and  a  concession  for  his  employees  to  join 
the  union  or  come  out  openly  on  its  side.  By  just  so  much  he 
has  weakened  his  bargaining  power  against  the  union.  Conse- 
quently, if  he  has  decided  not  to  have  a  certain  union  in  his 
shop  he  must  refuse  at  the  very  beginning  to  confer  with  its 
agents. 

If,  then,  the  Government  steps  in  and  compels  both  sides  to 
confer,  it  may  take  the  first  step  in  the  name  of  "compulsory 
investigation"  or  "compulsory  testimony,"  without  power 
to  prevent  a  strike  or  lockout.  If  the  Government  is  given 
power  to  step  in  and  compel  the  employer  and  employee  to 
testify,  to  produce  papers  and  records,  it  is  attempting  to 
substitute  compulsion  for  voluntary  consent  at  two  important 
steps  of  collective  bargaining.  It  introduces  compulsory  rec- 
ognition and  compulsory  negotiation1  under  the  guise  of ' '  com- 
pulsory testimony."  The  mere  compulsion  on  employers, 
through  prosecutions,  as  proposed  by  our  colleagues,  to  com- 
pel employers  to  confer  with  unions,  can  have  no  result,  unless 
it  be  accompanied  by  compulsion  to  investigate,  as  in  the 
Canadian  and  Colorado  acts,  or  to  arbitrate,  as  in  Australia. 
If  employers  are  compelled  merely  to  confer  they  can  of 
course  reject  all  propositions,  and  the  nominal  recognition  of 
the  union  thereby  secured  would  only  be  a  further  opportu- 
nity for  declaring  their  determination  not  to  recognize  the 
union.  If  such  a  law  is  intended  to  accomplish  anything  it 
should  go  further  and  compel  the  employers  to  submit  to  com- 
pulsory investigation  or  compulsory  arbitration,  and  this 
would  mean  compulsion  also  on  the  unions  to  confer  and  tes- 
tify or  to  arbitrate. 


-These  terms  may  appear  ridiculous  but  they  are  not  more  ridiculous  than 
the  term  "compulsory  arbitration."  Arbitration,  strictly  speaking,  is 
the  voluntary  consent  of  both  parties  to  refer  a  dispute  to  a  third  person 
and  to  accept  and  carry  out  his  decision.  It  is  no  longer  "arbitration" 
if  the  Government  coerces  the  parties  by  constituting  itself  the  third 
party  and  compelling  them  to  accept  and  carry  out  the  decision.  But  if, 
in  common  usage,  we  have  agreed  to  forget  the  absurdity  of  compulsory 
arbitration,  we  can  also  forget  the  same  absurdity  in  the  terms  "com- 
pulsory recognition"  and  "compulsory  negotiation." 


369 

In  our  hearings  in  San  Francisco  we  found  unions  that  re- 
fused to  meet  the  employers  for  a  joint  agreement,  but  re- 
quired them  to  sign  up  individually  the  demands  which  the 
unions  had  already  decided  upon.  This  can  not  properly  be 
called  collective  bargaining  or  recognition  of  an  employers' 
association  any  more  than  the  decision  of  employers  not  to 
deal  collectively  but  to  deal  with  their  employees  individually. 
A  law  requiring  employers  to  confer  with  and  recognize  unions 
should  also  require  unions  to  confer  with  and  recognize  em- 
ployers, and  if  this  is  made  effective  it  would  result  in  some- 
thing like  the  Canadian  or  Colorado  acts,  described  below. 
Employers  who  are  strongly  fortified  against  unions  object 
to  compulsory  testimony  because  it  weakens  their  bargaining 
power,  but  employers  dealing  with  strong  unions  desire  it  be- 
cause by  recognizing  the  union  they  have  already  consented 
to  investigation.  Their  next  step  is  to  compel  the  unions  to 
wait  for  the  investigation  before  striking. 

This  next  step  in  collective  bargaining  is  usually  a  provision 
that  both  sides  shall  continue  at  work  or  return  to  work  while 
investigation  and  determination  is  in  progress.  This  is,  of 
course,  the  great  object  of  arbitration,  and  practically  all  vol- 
untary methods  provide  that  work  shall  continue  while  arbi- 
tration is  going  on.  This  provision  is  recognized  in  the  Cana- 
dian Industrial  Disputes  Investigation  Act,  latterly  adopted 
by  New  Zealand  and  Colorado.  The  Government  prohibits 
either  side  from  a  strike  or  lockout  for  thirty  days,  pending 
compulsory  testimony  and  recommendation,  but  the  parties 
are  not  compelled  to  accept  the  recommendation.  After  the 
thirty  days  have  expired  they  may  start  their  strike  or  lock- 
out without  any  legal  penalty.  The  Government  meanwhile 
invites  each  side  to  appoint  its  representatives  on  a  board  of 
investigation  and  mediation  and  the  two  to  select  a  third 
member.  If  either  side  refuses  to  appoint  its  representative 
the  Government  steps  in  and  names  the  representative.  If 
both  sides  are  unable  to  agree  on  the  third  member  the  Gov- 
ernment again  steps  in  and  names  the  third  member.  In 
other  words,  the  Government  coerces  each  side  to  go  through 


370 

the  same  forms  that  they  would  do  if  they  agreed  voluntarily 
to  refer  a  dispute  to  arbitration,  and  it  prohibits  them  from 
strike  or  lockout  pending  a  finding  and  recommendation.  This 
is  compulsory  recognition,  compulsory  negotiation,  compul- 
sory testimony,  and  compulsory  labor  pending  investigation, 
but  without  compulsion  after  investigation. 

On  the  other  hand,  the  weak  union  favors  compulsory  con- 
ference and  recognition  because  it  seems  to  give  it  an  ad- 
vantage in  bargaining.  Both  strong  and  weak  unions  are 
opposed  to  compulsory  testimony  because  they  get  the  equiva- 
lent by  recognition,  and  they  fear  that  it  will  lead  to  the  com- 
pulsory waiting  of  the  Canadian  Act.  For  these  reasons  the 
Canadian  system  should  be  put  in  the  same  class  as  compul- 
sory arbitration,  since  the  Government  interferes  to  weaken 
or  strengthen  the  collective  bargaining  power  of  either  side. 
This  is  the  essential  point  of  Government  intervention.  The 
term  "arbitration"  is  misleading  because  it  signifies  the  vol- 
untary agreement  on  an  umpire  and  the  voluntary  acceptance 
of  his  award.  But  arbitration  can  not  be  voluntary  when  the 
Government  throws  its  coercive  power  to  one  side  or  the  other 
by  appointing  a  representative  of  either  side,  or  an  umpire, 
on  the  arbitration  board  without  the  consent  of  both  sides. 
This  is  coercive  interference  with  collective  bargaining  power, 
which  is  the  essential  element  in  compulsory  arbitration. 

For  this  reason  it  can  not  be  claimed  that  the  Canadian 
system  is  "voluntary  arbitration.' ■  This  term  is  also  mis- 
leading. Collective  bargaining  is  not  voluntary  in  the  same 
sense  that  individual  bargaining  is  voluntary,  since  it  depends 
on  certain  coercive  weapons  such  as  strikes,  boycotts,  black- 
lists, and  so  on,  together  with  strategy  in  using  these  weapons, 
and  these  are  not  instruments  in  individual  bargaining.  All 
that  is  meant  by  voluntary  arbitration  is  that  the  Government 
does  not  use  its  coercive  power  to  weaken  or  strengthen  the 
collective  coercion  of  either  side. 

The  first  object  of  the  Canadian  law  is  the  commendable  one 
of  bringing  both  parties  together  for  investigation  of  the 
demands  and  grievances,  with  the  hope  that,  by  delaying  hos- 


371 

tilities  for  thirty  days,  time  will  be  given  for  mediation,  con- 
ciliation and  a  voluntary  agreement.  For  this  reason  the 
boards  created  are  properly  called  boards  of  "  mediation  and 
investigation."  It  often  occurs  that  within  the  thirty  days 
both  sides  reach  such  a  voluntary  agreement  and,  if  so,  the 
board  is  dissolved  after  approving  the  agreement. 

The  second  object  is,  in  case  a  voluntary  agreement  is  not 
reached  by  this  kind  of  mediation  within  thirty  days,  that  the 
publication  of  a  set  of  recommendations  by  the  board  will 
bring  to  bear  the  pressure  of  public  opinion  on  both  sides  so 
that  they  will  feel  obliged  to  accept  the  recommendations  and 
continue  at  work.  Compulsory  recognition,  negotiation  and 
testimony  are  used  as  the  means  of  coercion  through  the  sup- 
port that  public  opinion  may  give  to  the  Government. 

But  mere  public  opinion  is  not  enough  to  accomplish  this 
object.  The  next  step  is  the  compulsory  arbitration  of  Aus- 
tralasia, which  brings  the  power  of  fine  and  imprisonment  to 
enforce  an  award  made  by  a  public  official. 

It  is  believed  that  any  of  these  compulsory  methods  are 
unsuited  to  American  conditions,  and  that  the  foregoing  rec- 
ommendation for  a  voluntary  board  of  investigation,  adapted 
from  the  Canadian  act  but  without  its  compulsory  features, 
will  prove  a  valuable  addition  to  the  present  "Newlands 
Act,"  which  goes  only  as  far  as  voluntary  arbitration  in  in- 
terstate railroad  disputes.  If  one  party  or  the  other  refuses 
to  accept  a  Board  of  Arbitration  with  power  to  make  a  binding 
award,  it  is  proposed  that  the  Mediator  shall  invite  both  to 
create  a  Board  of  Investigation  with  power  to  take  testimony 
and  to  make  recommendations  which  are  not  binding  as  an 
award.  The  jurisdiction  of  the  Newlands  Act  is  proposed  to 
be  extended  under  the  Federal  Commission  to  all  labor  dis- 
putes in  all  industries  engaged  in  interstate  commerce.  It  is 
believed  that,  in  many  cases  of  serious  public  concern,  neither 
side  can  afford  to  reject  an  offer  on  the  part  of  the  Govern- 
ment to  use  its  powers  of  compulsory  testimony  to  ascertain 
the  facts  and  to  make  recommendations,  provided  the  parties 
retain  their  liberty  to  reject  the  recommendations.    The  value 


372 

of  this  proposal  consists  in  the  probability  that  a  thorough 
investigation,  participated  in  by  both  sides,  may  lead  to  agree- 
ment, as  it  has  often  under  the  Canadian  Act.  But  this  should 
be  brought  about  by  consent  of  both  parties,  and  not  by  com- 
pulsory representation  of  either  side,  nor  compulsory  post- 
ponement of  hostilities,  as  provided  in  the  Canadian  Act. 

The  intent  of  the  foregoing  recommendation  is  that  the 
Mediator  shall  use  all  of  the  powers  of  persuasion  that  he  can 
summon,  but  is  not  to  use,  nor  to  be  in  a  position  to  threaten 
or  even  to  suggest  the  use  of,  any  powers  of  coercion.  Even 
compulsory  testimony  is  to  be  used  only  in  case  he  can  per- 
suade both  parties  to  consent  to  its  use.  The  Mediator  is  not 
even  permitted  to  make  public  any  information  he  may  ac- 
quire regarding  a  dispute,  or  to  give  that  information  to  the 
Industrial  Commission  or  to  any  other  public  authority  that 
has  the  power  of  Governmental  coercion.  Mediation  and  ar- 
bitration are  to  be  voluntary  throughout,  as  far  as  Govern- 
ment is  concerned. 

The  case  is  different  with  individual  bargaining.  Here,  it  is 
recognized  that  the  individual  worker  is  at  a  disadvantage 
with  the  employer.  In  fact,  he  usually  makes  no  bargain  at 
all.  He  merely  accepts  or  rejects  the  terms  offered  by  the  em- 
ployer. Where  this  is  so,  and  there  is  a  public  interest  to  be 
gained,  Congress  or  the  legislatures  and  the  Industrial  Com- 
missions should  exercise  adequate  compulsory  powers  to 
equalize  and  protect  the  bargaining  power  of  individual  em- 
ployees. 

It  should  be  remembered  that,  in  the  eyes  of  the  law,  the 
labor  contract  is  an  individual  contract — a  contract  between 
an  individual  workman  and  an  individual  employer.  Even  if 
the  employer  is  a  corporation  of  thousands  of  stockholders 
and  bondholders,  they  are  treated  as  a  single  individual  for 
the  purposes  of  a  contract.  But  the  law  does  not  usually  rec- 
ognize a  collective  or  joint  agreement  between  a  union  and  an 
employer  or  employers'  association,  as  a  contract.  The  courts 
will  not  usually  enforce  it  as  they  enforce  individual  con- 
tracts.   Such  a  contract,  so  called,  will  not  bind  anybody  by 


373 

the  force  of  law.  A  contract  with  a  trade  union  is  not  a  con- 
tract in  law — it  is  merely  an  understanding,  or  a  usage,  or  a 
joint  agreement,  that,  when  the  real  labor  contract  is  made  be- 
tween individual  employer  and  employee,  it  will  be  made  ac- 
cording to  the  terms  of  the  joint  agreement.  If  an  individual 
employer  breaks  the  agreement  by  hiring  a  workman  on  differ- 
ent terms,  the  only  means  that  the  union  has  of  enforcing  the 
agreement  is  that  of  a  strike.  It  is  not  a  breach  of  contract. 
The  union  can  not  usually  get  an  injunction  or  damages  in 
court  on  account  of  the  violation.  In  the  same  way  the  em- 
ployer's only  practicable  remedy  is  the  lockout.  He  probably 
can  not  bring  a  suit  for  damages  because  the  union  agreement 
was  not  a  contract.  The  legislature  might,  of  course,  change 
the  law  and  provide  for  the  legal  enforcement  of  the  collective 
bargain.  This  would  be  compulsory  arbitration.  But  as  it 
now  stands  a  joint  trade  agreement  is  a  kind  of  usage  or  un- 
derstanding agreed  to  by  two  opposing  interests  and  gen- 
erally enforced  on  individuals  by  the  coercive  weapons  of 
strike,  lockout,  boycott,  or  blacklist.  It  differs  from  a  statute 
in  the  fact  that  its  enforcement  is  left  to  private  organizations 
or  individuals  while  the  enforcement  of  a  statute  or  order  of 
a  Commission  is  effected  by  the  penalties  of  imprisonment, 
fines,  or  damages.  A  minimum  wage  law,  for  example,  may 
differ  in  no  respect  from  a  joint  agreement  with  a  union,  ex- 
cept that  the  one  is  enforced  by  legal  penalties  or  the  threat 
of  penalties,  and  the  other  by  a  strike  or  the  threat  of  a 
strike. 

The  practical  conclusion  to  be  drawn  from  this  distinction  is 
that,  since  a  State  Industrial  Commission  may  be  both  a  me- 
diator and  a  minimum  wage  commission,  it  should  act  only 
as  a  voluntary  mediator  where  a  union  is  actually  in  operation 
and  securing  agreements.  But  where  there  is  no  effective 
union  there  the  minimum  wage  should  apply.  This  is  the  con- 
dition of  women  and  child  workers,  and  for  them  the  State, 
but  not  the  Federal  Commission,  should  create  advisory  min- 
imum wage  boards,  which,  acting  with  the  women  inspectors 
of  the  Commission,  should  make  investigation  and  recommend 


374 

the  minimum  wage  and  other  conditions  to  the  Industrial  Com- 
mission. The  last-named  would  then  hold  public  hearings  and 
the  rules  of  law  would  apply  as  already  outlined  in  preceding 
paragraphs. 

The  same  principle  applies  to  other  labor  legislation  which 
regulates  the  individual  labor  contract,  such  as  child  labor 
laws,  workmen's  compensation,  safety,  health,  employment 
offices,  legal  aid,  mechanics '  liens,  and  so  on.  These  are  mat- 
ters which  are  not  usually  an  issue  in  collective  bargaining 
even  of  unions  composed  of  men,  and  do  not  usually  lead  to 
strikes  or  lockouts.  Neither  is  the  individual  workman,  in 
making  his  contract  of  employment,  able  to  protect  himself 
in  these  matters.  When  Government  here  comes  to  the  aid  of 
the  weaker  party  to  the  wage  bargain,  it  is  not  usually  inter- 
vening in  the  field  of  collective  bargaining.  The  situation  is 
different  in  matters  of  wages,  hours  of  labor,  and  shop  rules 
which  govern  the  manner  of  work,  dismissals,  promotions,  and 
so  on.  Where  unions  show  themselves  strong  enough  to  pro- 
tect individuals  in  these  matters  the  function  of  Government 
should,  as  far  as  possible,  be  limited  to  voluntary  mediation. 

It  doubtless  has  appealed  to  some  people  who  consider  the 
employer's  position  more  powerful  than  that  of  the  union, 
that  the  employer  should  be  compelled  in  some  way  to  deal 
with  unions,  or  at  least  to  confer  with  their  representatives. 
But,  if  the  State  recognizes  any  particular  union  by  requiring 
the  employer  to  recognize  it,  the  State  must  necessarily  guar- 
antee the  union  to  the  extent  that  it  must  strip  it  of  any 
abuses  that  it  may  practice.  The  State  might  be  compelled  to 
regulate  its  initiation  fees  and  dues,  its  apprenticeship  ratio, 
its  violation  of  agreements,  and  all  of  the  other  abuses  on 
account  of  which  the  employer  refuses  to  deal  with  it.  This 
is  exactly  what  is  done  through  compulsory  arbitration,  and 
there  is  no  place  where  the  State  can  stop  if  it  brings  compul- 
sion to  bear  on  the  employers  without  also  regulating  by  com- 
pulsion the  unions.  If  so,  the  whole  question  is  transferred 
to  politics,  and  the  unions  which  attempt  to  use  a  friendly 
party  to  regulate  the  employer  may  find  a  hostile  party  reg- 


375 

ulating  them.  We  believe  that  collective  bargaining  and  joint 
agreements  are  preferable  to  individual  bargaining,  and  we 
believe  that  the  general  public  should  support  the  unions  in 
their  efforts  to  secure  collective  agreements.  But  this  can 
only  be  done  through  the  influence  of  public  opinion  without 
the  force  of  law.  It  is  based  on  the  conclusion  that  two  op- 
posing organizations,  equally  strong,  are  able  to  drive  out 
abuses  practiced  by  the  other.  This  is  very  different  from 
recommending  that  the  Government  should  step  in  and  drive 
out  the  abuses. 

This  conclusion  and  recommendation  in  favor  of  voluntary 
mediation  is  based  also,  in  part,  as  already  stated,  on  the 
distinction  between  collective  bargaining  and  the  individual 
labor  contract.  While  Government  for  the  past  eighty  years 
has  been  wisely  interfering  more  and  more  with  the  individual 
labor  contract,  through  child  labor  laws,  wage  payment  laws, 
mechanics'  liens,  workmen's  compensation  and  so  on,  for  the 
benefit  of  the  weaker  party,  yet  in  matters  of  Governmental 
interference  with  collective  bargaining,  we  have  to  deal  with 
great  organized,  hostile  interests,  that  are  capable  of  using 
their  power  in  the  politics  of  the  country,  in  the  administra- 
tion of  labor  laws,  and  even  in  the  courts  of  justice.  Any  in- 
terference with  their  collective  bargaining  power  forces  them 
to  get  control,  if  possible,  of  the  political  parties  or  the  execu- 
tive and  administrative  officials,  or  the  courts,  that  interfere. 
The  result  is  more  far-reaching  and  destructive  than  the  mere 
decision  one  way  or  another  in  a  particular  dispute.  It  tends 
to  corrupt,  or  to  discredit  or  to  make  inefficient,  the  Govern- 
ment itself.  This  country  is  so"  large,  with  such  extremes  of 
sectional  interests,  with  industrial  and  class  interests,  with 
nationality  and  race  interests,  and  with  such  extremes  of 
wages  and  costs  of  living,  that  it  is  an  easy  matter  for  these 
powerful  organized  interests  to  make  alliances  with  others 
for  the  appointment  or  control  of  officials.  When  this  is 
done,  neither  side  can  have  confidence  in  the  mediators  or  ar- 
bitrators who  are  chosen  without  their  consent.  A  system, 
even  though  compulsory  only  in  part,  is  likely  to  break  down 


376 

after  a  few  decisions  which  are  resented  by  either  side.  The 
department  or  commission  responsible  for  the  decision  loses 
confidence  and  therefore  usefulness.  For  this  reason  the  weak- 
est part  of  our  recommendation  is  that  the  Mediator  shall  ap- 
point the  third  party  to  a  voluntary  Board  of  Arbitration  or  a 
voluntary  Board  of  Investigation,  in  case  the  two  parties  can 
not  agree.  It  seems  necessary  that  some  authority  be  given 
that  power.  But  the  Mediator  is  likely  to  lose  the  confidence  of 
the  side  that  loses  in  an  arbitration,  since  he  will  be  held  re- 
sponsible for  the  arbitrator  whom  he  appointed.  This  might  in- 
capacitate him  for  future  mediation.  But  we  can  think  of  no 
other  agency  that  would  be  acceptable  to  both  sides.  If  the 
mayor,  or  the  Governor,  or  the  President  appoints  the  third 
man,  employers  would  object.  If  the  courts  were  to  appoint 
him  the  unions  would  object.  We  are  forced  to  recommend 
that  this  authority  be  given  to  the  Mediator,  but  we  propose 
that  he  should  not  be  tied  down  to  any  procedure  that  would 
prevent  him  from  devising  any  system  that  his  ingenuity 
might  suggest  rather  than  fall  back  on  his  precarious  power  of 
appointing  the  odd  man. 

After  considering  all  forms  of  Governmental  compulsion  in 
collective  disputes  and  even  admitting  their  partial  success 
in  other  countries,  we  conclude  that,  on  the  whole,  in  this 
country,  as  much  can  be  accomplished  in  the  long  run  by 
strictly  voluntary  methods  as  by  compulsory  methods  of  avoid- 
ing strikes  and  lockouts.  It  can  not  be  expected  that  strikes 
and  lockouts  can  be  abolished  altogether.  Even  countries  with 
compulsory  systems  have  not  succeeded  in  preventing  all  of 
them.  In  our  country,  the  voluntary  method  in  collective  bar- 
gaining avoids  the  much  more  serious  evil  of  discrediting  the 
agencies  of  Government  which  must  be  looked  to  for  impar- 
tial enforcement  of  laws  affecting  the  individual  labor  con- 
tract. It  is  to  the  enactment  and  enforcement  of  laws  pro- 
tecting laborers  as  individuals  that  we  must  look  for  the  re- 
moval of  underlying  causes  of  industrial  unrest  and  for  the 
eventual  reduction  of  strikes  that  now  spring  from  the  cumula- 
tive abuses  that  individuals  suffer  without  other  effective  rem- 


377 

edies.  But  the  removal  of  these  abuses  can  not  be  accom- 
plished without  the  efficient  and  nonpartisan  administration 
of  laws,  and  this  is  the  main  purport  of  our  recommendation 
for  Industrial  Commissions  to  regulate  the  individual  labor 
contract. 

TRADE   DISPUTES. 

15.  Congress  and  the  State  legislatures  to  enact  laws  sim- 
ilar to  the  British  Trades  Disputes  Act  of  1906,  relieving  em- 
ployers' associations  and  labor  unions,  as  well  as  their  mem- 
bers, officers,  or  agents,  when  acting  in  their  behalf,  of  crim- 
inal suits,  damage  suits  and  injunctions  on  account  solely  of 
combination  or  conspiracy  connected  with  a  labor  dispute, 
when  the  act  would  be  lawful  if  done  by  one  person.  Such 
laws  would  permit  the  use  by  either  side  without  legal  pen- 
alty of  its  weapons  of  closed  union  shop  and  closed  nonunion 
shop,  of  strike  and  lockout,  boycott  and  blacklist,  peaceful 
picketing  and  strikebreaking,  peaceful  inducement  to  break  a 
contract  to  work  or  to  break  off  allegiance  with  a  union,  in 
pursuance  of  an  effort  to  win  a  labor  dispute.  The  law  would 
not  prevent  prosecutions  for  conspiracy  where  the  act  if  done 
by  one  person  would  be  a  crime.  We  copy  below  sections  of 
the  British  Trades  Disputes  Act  as  indicating  the  kind  of  leg- 
islation, which  with  modifications  to  suit  American  laws  would 
probably  reach  these  objects : 

(Conspiracy.)  An  agreement  or  combination  by  two 
or  more  persons  to  do  or  procure  to  be  done  any  act  in 
contemplation  or  furtherance  of  a  trade  dispute  between 
employers  and  workmen  shall  not  be  indictable  as  a  con- 
spiracy if  such  an  act  committed  by  one  person  would  not 
be  punishable  as  a  crime  *  *  *  An  act  done  in  pursuance 
of  an  agreement  or  combination  by  two  or  more  persons 
shall,  if  done  in  contemplation  or  furtherance  of  a  trade 
dispute,  not  be  actionable  unless  the  act,  if  done  without 


378 

any  such  agreement  or  combination,  would  be  actiona- 
ble. 

(Damages.)  An  action  against  a  trade  union,  whether 
of  workmen  or  masters,  or  against  any  members  or  offi- 
cials thereof  on  behalf  of  themselves  and  all  other  mem- 
bers of  the  trade  union,  in  respect  of  any  tortious  act  al- 
leged to  have  been  committed  by  or  on  behalf  of  the 
trade  union,  shall  not  be  entertained  by  any  court. 

(Breach  of  Contract  and  Interference  with  Business.) 
An  act  done  by  a  person  in  contemplation  or  furtherance 
of  a  trade  dispute  shall  not  be  actionable  on  the  ground 
only  that  it  induces  some  other  person  to  break  a  contract 
of  employment  or  that  it  is  an  interference  with  the 
trade,  business,  or  employment  of  some  other  person,  or 
with  the  right  of  some  other  person  to  dispose  of  his  cap- 
ital or  his  labor  as  he  wills. 

(Picketing  and  Sabotage.)  It  shall  be  lawful  for  one  or 
more  persons,  acting  either  on  their  own  behalf  or  on  be- 
half of  a  trade  union  or  of  an  individual  employer  or  firm 
in  contemplation  or  furtherance  of  a  trade  dispute,  to  at- 
tend at  or  near  a  house  or  place  where  a  person  resides 
or  works  or  carries  on  business  or  happens  to  be,  if  they 
so  attend  merely  for  the  purpose  of  peacefully  obtaining 
or  communicating  information,  or  of  peacefully  persuad- 
ing any  person  to  work  or  abstain  from  working. 

Every  person  who,  with  a  view  to  compel  any  other 
person  to  abstain  from  doing  or  to  do  any  act  which  such 
other  person  has  a  legal  right  to  do  or  abstain  from  doing, 
wrongfully  and  without  legal  authority — 

1.  Uses  violence  to  or  intimidates  such  other  person 
or  his  wife  or  children,  or  injures  his  property ;  or, 

2.  Persistently  follows  such  other  person  about  from 
place  to  place;  or, 

3.  Hides  any  tools,  clothes,  or  other  property  owned 
or  used  by  the  other  person,  or  deprives  him  of  or  hin- 
ders him  in  the  use  thereof;  or, 


379 

4.  Watches  or  besets  the  house  or  other  place  where 
such  other  person  resides,  or  works,  or  carries  on  busi- 
ness, or  happens  to  be,  or  the  approach  to  such  house  or 
place;  or, 

5.  Follows  such  other  person  with  two  or  more  other 
persons  in  a  disorderly  manner  in  or  through  any  street 
or  road, 

shall  on  conviction  thereof  by  a  court  of  summary 
jurisdiction,  or  an  indictment  as  hereinafter  mentioned, 
be  liable  either  to  pay  a  penalty  not  exceeding  twenty 
pounds,  or  to  be  imprisoned  for  a  term  not  exceeding 
three  months,  with  or  without  hard  labor. 

It  is  apparent,  from  all  the  preceding  recommendations, 
that  the  creation  of  Industrial  Commissions  with  Advisory 
Councils,  depends  for  its  success  on  the  permanency  of  or- 
ganizations of  employers  and  organizations  of  laborers.  It  is 
only  as  we  have  organizations  that  we  can  have  real  repre- 
sentation. The  preceding  recommendations  are  designed, 
through  salaried  positions  for  Civil  Service  appointees  and 
unsalaried  positions  for  the  representatives  of  organizations, 
to  keep  the  latter  continuously  responsible  to  the  organiza- 
tions that  elect  and  recall  them.  For  this  reason  any  policy 
of  Government  that  tends  to  destroy  the  organizations  or  to 
compel  them  to  hide  their  operations  in  secrecy  tends  to 
weaken  the  basis  upon  which  improvement  in  the  enactment 
and  administration  of  labor  law  must  be  based.  Such  a  pol- 
icy is  that  which  permits  employers  to  collect  damages,  and  in 
a  lesser  degree,  to  secure  injunctions,  against  unions,  without 
at  the  same  time  effectually  permitting  unions  to  bring  sim- 
ilar proceedings  against  employers'  associations.  The  de- 
cision in  the  case  of  the  hatters'  union  (208  U.  S.  274)  award- 
ing heavy  damages  for  boycotting  against  practically  all  mem- 
bers of  the  local  union,  will  make  it  possible  to  collect  dam- 
ages in  all  cases  where  an  unlawful  conspiracy  is  shown. 
Since  damages  arise  from  all  strikes  and  boycotts,  there  is  no 
conceivable  limit  to  which  suits  for  damages  can  be  brought. 


380 

The  result  must  be  the  weakening  or  destruction  of  unions 
or  driving  them  into  secrecy  and  a  more  generally  avowed 
policy  of  violence. 

This  policy  also  brings  the  courts  into  the  field  of  collective 
bargaining,  and  necessarily  leads,  sooner  or  later,  to  the 
efforts  of  both  sides  to  control  the  judicial  as  well  as  the 
administrative  and  legislative  branches  of  Government.  Just 
as  our  earlier  recommendations  were  intended,  in  part,  to  take 
the  administration  of  labor  law  out  of  the  hands  of  either  side, 
and  to  make  it  a  joint  affair,  so  this  recommendation  is  in- 
tended, in  part,  to  relieve  the  courts  of  similar  partisanship 
in  matters  of  collective  bargaining.  It  is  believed  that  strong 
organizations  of  employers  and  employees  are  much  more 
capable  than  the  courts  of  holding  each  other  in  check  and 
preventing  abuses  on  either  side.  The  recommendation  is  in- 
tended to  recognize  the  collective  weapons  of  both  sides  as 
the  means  of  securing  this  result,  and  yet,  through  the  Indus- 
trial Commission  and  its  Advisory  Council,  including  media- 
tors and  the  efficient  enforcement  of  labor  laws,  to  minimize 
the  necessity  of  resorting  to  these  weapons. 

The  so-called  Clayton  Act  of  1913  was  supposed  by  some 
lawyers  to  accomplish  the  result  intended  in  the  foregoing 
recommendation,  but  other  lawyers  contend  that  the  law  of 
conspiracy  has  not  been  changed  by  the  act.  At  any  rate, 
the  law  does  not  apply  to  the  States,  only  one  of  which,  Cali- 
fornia, has  adopted  a  similar  law,  and  another,  Massachusetts, 
has  withheld  adoption  owing  to  an  unfavorable  reply  by  the 
Supreme  Court  on  the  question  propounded  by  the  legislature. 
It  is  admitted  that  the  British  Act  accomplishes  the  intended 
purpose,  and  consequently  we  take  it  as  the  model  in  case  these 
other  acts  are  found,  under  court  decisions,  not  to  do  so. 

The  recommendation  is,  as  already  said,  intended  to  pre- 
vent the  courts  from  interfering  with  the  collective  weapons, 
provided  they  are  peaceful,  that  either  side  uses  to  defeat  the 
other  side.  It  is  recognized,  of  course,  that  these  weapons  are 
coercive  and  are  intended  to  be  coercive,  but  they  are  not  co- 
ercive in  the  sense  of  physical  violence.    They  are  coercive 


381 

only  in  the  sense  that  numbers  of  people  acting  together  to  do 
an  act  lawful  for  each  separately,  have  more  power  over  in- 
dividuals than  a  single  individual  acting  by  himself  would 
ordinarily  have.  But  even  an  individual  acting  alone  may 
have  the  same  kind  of  coercive  power,  which  in  his  case  would 
be  lawful,  as,  for  example,  when  an  employer  compels  a  union 
man  to  give  up  his  membership  in  a  union  by  threatening  to 
discharge  him  if  he  does  not.  This  kind  of  individual  coer- 
cion is  held  to  be  entirely  lawful,  and  any  State  or  Federal 
statute  which  prevents  the  employer  from  using  such  coercion 
is  unconstitutional.  This  is  so  even  if  the  employer  is  a  cor- 
poration with  thousands  of  stockholders  and  bondholders,  for 
the  corporation  is  held  to  be,  for  that  purpose,  not  a  con- 
spiracy but  a  single  person.  By  declaring  laws  unconstitu- 
tional which  attempt  to  deprive  the  employer  or  corporation 
of  the  right  to  discharge  a  man  on  account  of  his  unionism, 
the  court  steps  in  to  prohibit  the  State  from  depriving  the 
employer  of  a  coercive  weapon  used  to  defeat  the  union.  It 
prohibits  a  State  from  depriving  an  employer  of  the  closed 
nonunion  shop  as  a  coercive  weapon  against  unions. 

A  counter-weapon  which  the  union  has  is  the  closed  union 
shop.  If  the  employer  discharges  or  threatens  to  discharge 
one  of  his  employees  on  account  of  his  membership  in  a  union, 
the  only  effective  weapon  that  the  employee  may  have,  in 
order  to  retain  his  membership,  may  be  a  strike  or  the  threat 
of  a  strike  by  his  union  to  compel  the  employer  to  discharge 
all  nonunion  men.  In  some  States  a  strike  for  such  a  purpose, 
under  the  decisions  of  the  courts,  is  unlawful,  on  the  ground 
that  it  is  a  conspiracy  to  compel  the  employer  to  give  up  his 
right  to  employ  whom  he  pleases,  or  a  conspiracy  to  deprive 
the  nonunion  man  of  his  right  to  work  for  whom  he  pleases. 
The  foregoing  recommendation  is  intended  to  make  it  plain 
that  no  employer  or  union  of  employers  shall  be  prevented  by 
law  or  by  a  court  from  running  a  closed  nonunion  shop  if  he 
can,  and  no  union  shall  be  prevented  from  compelling  him  to 
run  a  closed  union  shop  if  it  can,  so  long  as  the  method  would 
be  lawful  for  a  person  not  backed  by  a  union. 


382 

In  a  similar  way  it  is  lawful  for  an  employer  to  furnish 
other  employers,  whether  members  of  his  association  or  not, 
with  information  as  to  whether  an  employee  is  a  member  of 
a  union  or  a  union  agitator,  and  to  file  such  information  in  the 
employment  bureau  of  an  employers'  association.  If  the 
workman  can  not  prevent  his  employer  by  law  from  discharg- 
ing him  on  account  of  unionism,  much  less  can  he  require  an- 
other employer  to  hire  him.  It  is  lawful  also  for  an  employ- 
ers' association  to  expel  a  member  who  refuses  to  comply  with 
a  nonunion  rule,  and,  except  in  case  of  a  public  utility,  to  re- 
fuse to  deal  with  him  or  to  discriminate  against  him.  Fur- 
thermore, since  other  employers'  rights  of  furnishing  infor- 
mation to  fellow  employers  are  so  great,  it  is  practically  im- 
possible to  get  proof  that  they  contain  the  malicious  purpose 
which  constitutes  a  blacklist,  and  statutes  preventing  employ- 
ers from  using  some  of  these  legal  rights  have  been  held  un- 
constitutional. But,  as  a  rule,  the  employers'  blacklist  does 
not  need  to  go  to  these  extreme  measures  permitted  by  law, 
because  it  is  effective  short  of  these  measures. 

The  case  is  different  with  the  union's  weapon,  the  boycott. 
To  carry  out  a  boycott  the  union  must  circulate  "unfair  lists" 
and  must  induce  as  many  persons  as  possible  to  withdraw 
their  patronage.  The  courts  distinguish  between  the  primary 
boycott  and  the  secondary  boycott.  The  former  is  perhaps 
legal  in  some  cases,  just  as  a  strike  is  legal,  for  it  is  merely 
the  refusal  to  patronize  an  employer  on  the  part  of  the  same 
persons,  or  their  fellow-unionists,  who  have  struck  against 
the  employer,  or  who  are  locked  out  or  blacklisted  by  him  or 
his  association.  It  is  doubtful,  though,  whether  this  primary 
boycott  is  legal  if  it  extends  to  members  of  unions  other  than 
the  one  directly  injured.  The  American  Federation  of  Labor, 
for  example,  can  not  carry  out  a  primary  boycott  on  goods 
which  the  hatters'  union  has  boycotted,  since  it  is  prohibited 
from  publishing  the  information.  And  even  the  strike  and  the 
primary  boycott  are  sometimes  unlawful  if  the  court  holds 
that  the  purpose  or  the  means  are  unlawful.  The  courts  will 
not  directly  enjoin  either  a  strike  or  a  primary  boycott.    They 


383 

can  not  compel  a  man  to  work  or  to  purchase.  But  they  can 
make  the  unlawful  strike  or  primary  boycott  ineffective  by 
enjoining  even  peaceful  picketing  or  persuasion,  or  the  cir- 
culation of  " unfair  lists"  designed  to  notify  others  that  the 
boycott  is  on. 

But  the  secondary  boycott  is  generally  held  illegal  because 
it  is  an  additional  boycott  placed  upon  a  third  party,  usually 
a  merchant,  who  continues  to  sell  the  goods  of  the  boycotted 
employer.  As  to  this  third  party  the  boycott  is  primary,  and 
he  can  secure  an  injunction  or  damages  on  the  ground  of  con- 
spiracy to  injure  him  without  just  cause,  or  to  compel  him  to 
break  a  contract,  if  he  considers  the  damage  to  himself  worth 
while.  But  boycott  suits  are  not  often  brought  by  third  par- 
ties, either  because  the  damage  to  them  is  usually  slight,  since 
they  only  need  to  patronize  other  manufacturers  whose  goods 
the  boycotters  are  willing  to  buy,  or  because  the  courts  pro- 
tect them  through  suits  brought  by  the  party  originally  boy- 
cotted. The  employer  originally  boycotted  would  not  secure 
protection  if  he  depended  on  a  hundred  or  a  thousand  boy- 
cotted merchants  not  seriously  concerned,  to  bring  separate 
suits.  Consequently  the  vast  majority  of  boycott  cases  are 
brought  by  the  person  primarily  boycotted,  in  order  to  pre- 
vent the  spread  of  boycotts  to  other  persons  who  deal  with 
him;  in  other  words,  to  prevent  a  secondary  boycott  against 
himself.  The  boycotted  employer  hides  behind  the  alleged  in- 
jury done  to  third  parties  in  order  to  get  damages,  not  for 
them,  but  for  himself,  as  in  the  case  of  the  Loewe  Company 
against  the  hatters '  union.  The  ground  of  action  is  not  injury 
to  third  parties  but  interference  with  the  employers'  right  to 
have  free  and  uninterrupted  business  dealings  with  all  who 
wish  to  deal  with  him.  This  does  not  seem  to  be  equal  treat- 
ment of  the  employers'  blacklist  which  interferes  with  the 
unionists'  right  to  have  uninterrupted  access  to  all  employers, 
and  the  employees '  boycott  which  interferes  with  the  employ- 
ers '  right  of  access  to  the  commodity  market. 

The  arguments  now  used  to  declare  the  secondary  boycott 
illegal  are  those  formerly  used  to  declare  the  strike  and  the 


384 

primary  boycott  illegal.  Our  recommendation  simply  carries 
forward  another  step  the  effort  to  secure  equality  between 
organized  capital  and  organized  labor. 

Of  the  other  weapons,  the  strike  and  lockout,  the  employers ■ 
association  does  not  usually  employ  its  weapon,  because  it  can 
force  the  union  to  strike  or  yield,  but  the  strike  is  illegal  if  the 
purpose  is  illegal,  such  as  the  purpose' in  some  States  of  se- 
curing a  closed  union  shop.  The  recommendation  is  intended 
to  remove  all  illegality  from  the  strike. 

This  recommendation  is  intended  to  do  away  with  the  doc- 
trine of  conspiracy  for  both  employers'  associations  and  labor 
unions,  except  in  so  far  as  the  conspiracy  is  one  to  commit 
what  would  be  a  crime  for  one  person,  and  to  do  away  with 
all  suits  for  damages,  including  injunctions  to  prevent  dam- 
age, against  a  union  or  against  its  members  when  acting  for 
the  union,  except  suits  for  damages  against  conspirators  to 
commit  a  crime. 

The  doctrine  of  conspiracy  is  based  on  the  undoubted  fact 
that,  while  a  lawful  act  done  by  only  one  person  may  be  coer- 
cive and  cause  damage,  or  be  intended  to  cause  damage,  yet 
the  coercion  and  damage  are  ordinarily  so  small,  compared 
with  the  social  advantage  of  liberty  to  do  as  one  pleases, 
that,  except  in  breach  of  contract,  the  court  does  not  enter- 
tain a  suit  at  law  for  damages  or  for  prevention  of  the  coer- 
cion that  causes  damages.  Yet  the  same  lawful  act,  if  done 
by  agreement  between  two  or  more  persons,  may  reach  a  point 
of  coercion  where  the  damage,  compared  with  the  social  ad- 
vantage of  liberty  to  combine  with  others,  is  so  serious  that 
the  agreement  becomes  unlawful.  Therefore,  those  who  enter 
into  an  agreement  to  do  an  act  which  would  be  lawful  with- 
out the  agreement,  or  their  agents,  may  be  prosecuted  for 
damages,  or  may  be  prevented  by  injunction  from  using  the 
coercive  power  of  numbers  to  cause  the  damage.  It  is  this 
doctrine  of  conspiracy,  or  coercion  through  mere  numbers, 
that  is  sought  to  be  removed  by  the  recommendation.  Indi- 
viduals, and  the  individual  members  of  unions  who  conspire 
with  them,  would  continue  to  be  arrested,  prosecuted  and 


385 

punished  as  individuals  or  conspirators  for  all  acts  which  are 
criminal  for  them  as  individuals,  but  no  suit  for  damages 
could  be  brought  against  the  union  for  acts  committed  by  or 
on  behalf  of  the  union. 

In  other  words,  the  recommendation  removes  completely 
the  doctrine  of  civil  conspiracy  according  to  which  damages 
may  be  collected  or  injunctions  issued.  It,  however,  retains 
the  doctrine  that  all  conspirators  who  join  in  procuring  an 
act  that  is  criminal  for  one  person  to  do  are  likewise  guilty 
with  the  person  who  does  it.  This  might  include  all  the  mem- 
bers of  a  union  if  all  were  proven  actually  to  have  joined  in 
such  a  conspiracy.  Those  who  conspired  could  still  be  prose- 
cuted and  sent  to  prison,  as  was  done  in  the  case  of  the  officers 
and  members  of  the  structural  iron  workers  for  transporting 
dynamite.  The  recommendation  is  not  intended  to  change  the 
law  in  this  respect.  It  would  change  the  law  in  the  hatters' 
case. 

Employers  are  already  learning  the  ineffectiveness  of  the 
injunction  and  the  danger  to  themselves  of  throwing  on  the 
courts  the  burden  of  protection  which  they  can  as  readily 
secure  through  their  own  organizations.  With  their  advan- 
tages of  position,  both  as  owners  of  the  means  of  livelihood 
and  the  possessors  of  the  power  of  discharge  and  of  blacklist 
of  union  members  which  goes  with  the  ownership  of  property, 
they  have  a  superior  power  over  unions.  Our  recommenda- 
tions do  not  grant  employers'  associations . rights  additional 
to  those  which  they  now  enjoy  in  fact;  they  merely  grant  the 
unions  corresponding  rights. 

The  British  Act  also  defines  the  kind  of  picketing  that  is 
criminal  in  that  it  is  not  peaceful,  and  thereby  defines  what 
is  peaceful  picketing  In  these  cases  of  illegal  or  criminal  pick- 
eting, and  in  the  destruction  or  damage  to  physical  property, 
those  who  have  done  the  criminal  acts  and  those  who  have 
conspired  to  have  them  done  may  be  fined  and  imprisoned,  but 
the  union  funds  or  the  property  of  its  members  not  proven 
to  have  joined  in  the  criminal  conspiracy  could  not  be  taken 
for  damages. 


386 

Without  entering  into  further  details,  the  object  of  the  rec- 
ommendation is  to  place  unions  and  employers'  associations 
upon  an  equal  basis  in  the  use  of  their  competitive  weapons. 

Regarding  the  constitutionality  of  this  recommendation  it 
should  be  noted  that  it  takes  both  employers '  associations  and 
unions  from  under  the  operation  of  the  antitrust  laws.  This 
differs  from  the  Clayton  and  other  acts  which  take  only  unions 
from  under  the  antitrust  laws  or  common  law  and  might  be 
good  ground  for  declaring  these  laws  unconstitutional.  The 
British  Act  does  this  by  distinguishing  between  employers  as 
merchants  or  associations  of  manufacturers,  who  sell  com- 
modities to  the  public,  and  whose  bargain  may  be  called  the 
"price  bargain,"  and  the  same  employers  in  the  different 
function  of  dealing  with  labor,  and  whose  bargain  is  the  "wage 
bargain. ' j  The  employers,  in  their  function  of  merchants  and 
manufacturers,  or  sellers  of  products  or  commodities  to  con- 
sumers or  the  public,  continue  to  come  under  the  antitrust 
laws,  and  the  Interstate  Commerce  Commission,  the  Federal 
Trade  Commission  and  the  State  public  utility  commissions 
have  been  created  for  the  purpose  of  protecting  the  public 
against  them  as  such.  These  commissions  regulate  price  bar- 
gains for  commodities  or  products,  between  corporations  and 
consumers. 

But  it  does  not  follow  that  even  the  same  employers  when 
organized  to  regulate  the  wage  bargain  with  employees  should 
be  treated  as  a  conspiracy  or  trust.  They  perform  a  very  dif- 
ferent function  and  public  policy  is  very  different.  In  the  case 
of  the  price-bargain  the  public  is  interested  in  securing  low 
prices,  but  in  the  case  of  wage-bargain  it  is  interested  in  per- 
mitting high  wages.  Yet  the  public  needs  protection  against 
abuses  of  labor  unions  as  it  does  against  the  abuses  of  trusts. 
The  employers'  association  stands  between  organized  labor 
and  the  public  just  as  the  railroad  and  public  utility  commis- 
sions and  the  trade  commission  stand  between  merchants'  or 
manufacturers'  associations  and  the  unorganized  public.  But 
the  employers '  associations  are  a  better  protection  to  the  pub- 
lic against  the  abuses  of  unions  than  are  the  courts.  Labor 


387 

leaders  who  wish  to  keep  discipline  in  their  unions  and  the  ob- 
servance of  joint  agreements  realize  that  they  can  not  do  so  un- 
less confronted  by  a  strong  employers'  association.  They  real-, 
ize  that  continued  abuses  lead  eventually  to  the  destruction  of 
their  unions.  An  employer  who  stays  out  of  his  organization 
is  as  culpable  as  a  laborer  who  stays  out  of  his  union.  Em- 
ployers should  organize  100  per  cent  just  as  the  unions  en- 
deavor to  reach  that  mark. 

It  would,  therefore,  seem  to  be  proper  and  constitutional 
classification  in  the  interest  of  public  policy,  to  treat  manu- 
facturers under  a  law  prohibiting  or  regulating  trusts  and 
public  utilities  and  to  treat  the  same  persons  as  employers 
under  different  laws,  like  those  of  mediation  and  trade  dis- 
putes, where  both  employers'  associations  and  trade  unions 
are  given  immunities  for  the  use  of  peaceful  coercive  weapons 
which  they  do  not  possess  under  the  antitrust  laws. 


FOUNDATIONS. 

16.  Considerable  attention  has  been  given  by  this  Commis- 
sion to  the  largest  foundations  or  endowments  now  in  the 
hands  of  private  trustees.  Any  proposed  legislation  on  this 
subject  should  be  preceded  by  a  complete  investigation  of  all 
foundations  and  endowments,  else  the  law  would  have  effects 
not  contemplated  by  the  legislature  or  Congress.  Such  an 
investigation  would  include  all  endowed  charities,  endowments 
of  religious  organizations  and  universities  and  colleges.  We 
are  informed  that  such  investigations  have  been  made  in  Eng- 
land and  France,  resulting  in  legislation.  The  investigation 
should  be  complete,  covering  all  aspects  of  the  question,  and 
bringing  out  both  the  advantages  and  the  disadvantages  of 
such  foundations  and  endowments.  The  legislature  could  then 
act  intelligently  on  the  subject. 

We  are  convinced  that  many  of  these  endowments  in  pri- 
vate hands  have  a  beneficial  effect  on  the  work  of  State  and 
Governmental  institutions.  Large  private  universities  have 
set  the  example  and  stimulated  the  States  to  support  and  en- 


388 

large  their  State  universities.  Some  of  the  investigations 
and  reforms  started  by  recent  large  foundations  have  already 
induced  Congress  and  administrative  departments  to  enter 
the  same  field  and  to  extend  it.  In  fact,  almost  everything 
that  Government  now  does  was  done  at  first  through  private 
initiative,  and  it  would  be  a  misfortune  if  private  endowments, 
unless  plainly  shown  to  have  committed  abuses,  should  be  pro- 
hibited. Even  their  abuses  can  be  rectified  by  the  legislature, 
through  its  control  over  charters,  if  reasonable  ground  can  be 
shown.  But  it  is  better,  for  the  most  part,  that  they  should 
go  on  at  their  own  initiative  in  order  that  the  people  through 
their  Government  may  see  the  value  of  their  work  and  then 
take  it  up  and  extend  it  more  widely  than  the  private  founda- 
tions are  able  to  do.  It  is  largely  for  this  reason  that  we  rec- 
ommend a  " Federal  Fund  for  Social  Welfare"  (Paragraph 
18),  in  order  that  the  Nation  may  compete  with  or  displace 
private  foundations  in  this  vital  matter. 

However,  experience  has  abundantly  shown  that  there 
should  be  no  alliance  between  these  private  foundations  or 
endowments  and  the  Government.  The  State  or  Government 
should  neither  subsidize  them  nor  be  subsidized  by  them,  nor 
cooperate  with  them.  Such  cooperation  has  often  led  to  pub- 
lic scandal.  Instead  of  subsidizing  private  charity  the  State 
should  use  its  money  to  displace  it  by  better  and  more  univer- 
sal charity.  Instead  of  calling  upon  private  foundations  for 
help  the  Government  should  treat  them  as  competitors.  No 
effort  on  the  part  of  Government  officials  to  secure  financial 
assistance  from  them  should  be  allowed. 


SUBSIDIES. 

17.  The  Federal  Commission  to  have  charge  of  all  subsidies 
granted  to  the  States  for  the  promotion  of  industrial  educa- 
tion, safety,  employment  offices,  and  other  matters,  as  Con- 
gress may  determine.  The  Commission  to  meet  the  expenses 
of  State  officials  when  called  together  for  conferences  on 


389 

standards  and  uniformity.    Subsidies  to  be  granted  on  condi- 
tion that  the  standards  are  maintained. 

The  Public  Health  Service  now  has  authority  to  call  con- 
ferences of  State  health  officials  and  to  meet  their  expenses. 
The  same  power  should  be  given  to  the  proposed  Industrial 
Commission.  A  large  part  of  the  work  of  the  Commission 
will  be  the  field  work  of  advising  State  officials  as  to  the  best 
methods  of  administration.  This  kind  of  work  is  now  done 
by  the  Department  of  Agriculture  and  the  Public  Health 
Service. 

Subsidies  are  recommended  in  certain  cases  because  the 
State  Governments  are  not  in  position  to  secure  adequate 
funds,  and  as  an  inducement  to  bring  their  standards  up  to 
the  standards  formulated  by  the  Federal  Commission. 

(Funds  for  this  purpose  are  recommended  in  Paragraph  18.) 

FEDERAL  FUND  FOR  SOCIAL  WELFARE. 

18.  A  Federal  inheritance  tax  on  all  estates  above  $25,000, 
beginning  at  1  per  cent  on  the  excess  above  $25,000  and  rising 
to  15  per  cent  on  the  excess  above  $1,000,000,  for  the  class  of 
direct  heirs,  such  as  wife,  children  and  parents.  Higher  rates 
for  more  remote  relatives  and  strangers.  The  Federal  in- 
heritance tax  to  be  a  supertax,  added  upon  the  existing  rates 
assessed  by  the  States.  Provision,  however,  to  be  made,  that 
any  State  which  repeals  all  inheritance  tax  laws,  or  refrains 
from  enacting  them,  shall  receive  from  the  Federal  Govern- 
ment, say  50  cents  per  capita  of  its  population  per  year.  The 
administration  and  collection  of  this  tax  to  be  placed  in  charge 
of  present  assessors  and  collectors  of  income  taxes,  who  al- 
ready collect  income  taxes  on  estates  in  the  hands  of  executors. 
Revenues  derived  from  inheritance  taxes  to  be  placed  in  trust 
with  the  Federal  Reserve  Board  for  investment  in  securities 
approved  by  Congress.    The  fund  to  be  known  as  "  Federal 


390 

Fund  for  Social  Welfare."  Expenditures  of  income  derived 
from  such  securities  to  be  made  under  the  direction  of  the 
Federal  Industrial  Commission  for  such  purposes  of  indus- 
trial and  social  welfare  as  Congress  may  authorize.  Should 
the  income  from  investments  not  be  adequate  to  meet  the 
authorized  expenditures,  further  investments  to  be  withheld 
and  the  principal  to  be  expended.  Revenues  derived  from 
activities  of  the  Commission,  such  as  head  tax  on  immigrants, 
etc.,  to  belong  to  the  fund.  Also  unexpended  balance  to  be 
held  in  the  fund  for  disposition  by  Congress. 

A  similar  fund  collected  from  immigrants  in  excess  of  the 
expenses  of  the  service  is  held  with  accruals  for  disposition 
by  Congress. 

"We  have  previously  shown  the  need  of  improved  adminis- 
tration in  providing  for  any  future  program  of  social  legisla- 
tion. "We  have  held  that  it  is  useless  to  undertake  any  addi- 
tional labor  legislation  if  effective,  nonpartisan  machinery  of 
administration  is  not  provided,  but  even  with  such  machinery 
it  can  not  be  expected  that  the  expense  of  Government  will  be 
reduced.  In  fact,  the  expenses  will  be  increased,  and  no  legis- 
lation should  be  attempted  unless  the  possibility  of  getting 
these  revenues  is  fully  considered. 

Moreover,  these  revenues  must  be  continuous,  else  the  whole 
program  will  be  liable  to  sudden  breakdown  through  failure 
of  funds.  Hostility  to  labor  laws  is  just  as  effective  when  it 
succeeds  in  killing  appropriations,  on  the  ground  of  economy, 
as  when  it  defeats  the  law  itself. 

Already  the  increased  expense  of  administration  of  labor 
laws  is  bringing  active  and  effective  protest.  The  greatest 
leap  in  this  expense  has  come  with  workmen's  compensation. 
So  far  as  this  increase  is  due  to  inefficiency  of  the  existing 
political  and  partisan  methods  of  administration  the  protest 
is  valid.  The  remedy  consists  in  improving  the  efficiency  and 
eliminating  the  partisanship,  and  this  is  the  purport  of  what 
we  have  previously  said.    So  far,  also,  as  the  increase  places 


391 

excessive  burdens  of  taxation  on  the  already  burdensome  taxes 
of  the  people,  the  protest  also  is  valid.  But  here  the  remedy 
consists  in  discovering  new  sources  of  revenue  that  will  not  be 
burdensome. 

A  Federal  inheritance  tax,  partly  distributed  to  the  States, 
seems  to  be  the  most  appropriate  method  of  securing  these  new 
sources  of  revenue.  The  principal  underlying  cause  of  social 
unrest  is  the  uncertainty  of  income  of  wage  earners  and  small 
producers.  A  steady,  continuous  income,  even  though  it  be 
small  in  amount,  is  of  more  importance  than  high  wages  or 
earnings  at  certain  times  and  no  earnings  at  other  times.  This 
uncertainty  of  income  is  the  main  cause  of  the  dependence, 
inequality  and  oppression  which  produce  conflicts  between 
capital  and  labor. 

The  great  majority  of  wage  earners  can  not  provide  in  ad- 
vance for  future  contingencies  when  they  will  get  no  income. 
These  contingencies  come  from  accidents,  sickness,  invalidity, 
old  age,  death,  unemployment  and  the  lack  of  industrial  edu- 
cation. 

There  are  two  main  reasons  for  this  inability  to  provide  for 
contingencies:  (1)  Inability  in  bargaining  for  wages  to  take 
into  account  future  contingencies  and  future  cost  of  living. 
The  wage  earner  may  be  able  when  bargaining,  to  get  enough 
wages  for  current  cost  of  living,  but  he  does  not  include  insur- 
ance premiums  in  his  notion  of  current  cost,  except  so-called 
"industrial  insurance"  to  provide  for  funeral  expense.  (2) 
Lack  of  thrift  and  habits  of  saving,  owing  in  part  to  their  own 
fault  and  in  part  to  the  contingencies  which  eat  up  their  sav- 
ings and  bring  discouragement.  In  either  case,  under  com- 
petitive industry,  the  condition  may  be  accepted  as  permanent. 

On  the  other  hand,  employers  and  investors  are  much  more 
able  to  provide  in  advance  for  a  future  continuous  income 
against  contingencies.  All  investments  are  made  with  refer- 
ence to  equalizing  the  flow  of  income  over  a  future  period  of 
time  in  the  form  of  interest  or  dividends. 

Inheritances  are  the  principal  means  by  which  owners,  with- 
out effort  or  thrift  on  their  part,  secure  titles  to  wealth  and  its 


392 

future  continuous  income.  Consequently,  for  the  Government 
to  take  a  part  of  large  inheritances  which  provide  continuous 
incomes,  and  to  devote  the  proceeds  to  the  purpose  of  making 
incomes  more  nearly  continuous  for  those  who  are  not  able, 
under  existing  conditions,  to  do  it  for  themselves,  appeals  to 
the  sense  of  justice.  It  may  be  accepted  in  advance  that  men 
of  wealth  will  approve  of  an  inheritance  tax  on  two  conditions, 
namely,  that  the  tax  will  be  devoted  to  a  great  public  purpose, 
and  that  the  funds  will  be  administered  economically  and  effi- 
ciently without  partisanship  or  practical  politics.  These  two 
conditions  are  essential  and  are  contemplated  in  our  recom- 
mendations for  a  Federal  Industrial  Commission  and  a  Fed- 
eral Fund  for  Social  Welfare. 

Some  of  the  purposes  for  which  this  fund  might  be  used,  in 
order  to  meet  the  object  of  Social  Welfare,  are,  in  addition 
to  the  overhead  expenses  of  the  Commission,  the  safety  and 
health  agencies  of  the  Federal  Government,  and  perhaps  sub- 
sidies to  States  conforming  to  standards;  industrial  educa- 
tion and  subsidies  to  States;  Federal  employment  offices  and 
subsidies  to  States  which  adopt  an  approved  plan  coordinat- 
ing with  the  Federal  plan ;  Federal  supervision  of  private  em- 
ployment offices  doing  interstate  business;  investigation  and 
statistics  of  labor  conditions;  mediation;  administration  of 
immigration  laws;  workmen's  compensation,  and  subsidies  to 
systems  of  sickness,  unemployment  and  other  forms  of  social 
insurance  as  may  be  approved  by  Congress.  Opportunities 
for  investment  should  be  considered,  such  as  workmen's 
houses,  workmen 's  hotels,  hospitals,  rural  credit  associations, 
and  similar  investments  made  by  Germany  in  respect  of  its 
various  insurance  funds. 

It  is  impossible  to  estimate  at  this  time  the  revenue  that 
would  be  derived  from  such  a  tax.  We  have  estimated  the 
amounts  now  collected  by  the  States  from  inheritance  taxes 
at  $25,000,000,  as  against  the  $50,000,000  that  they  would  re- 
ceive at  50  cents  per  capita.  The  present  systems  in  vogue 
in  32  States  yield  revenues  from  $1096  in  Wyoming  to  $11,162,- 
478  in  New  York.    The  amount  per  capita  of  population  ranges 


393 

from  one  cent  per  capita  in  Texas  and  Wyoming  to  59  cents 
in  Connecticut,  66  cents  in  Illinois,  68  cents  in  Massachusetts, 
and  $1.28  in  New  York.  The  latter  four  States  would  lose  if 
they  abolished  their  inheritance  tax  and  accepted  the  Fed- 
eral distribution  of  50  cents  per  capita.  Other  States  would 
gain.  Yet  this  can  not  be  considered  a  just  criticism  of  the 
proposal,  for  the  States  which  lose  are  those  in  which  wealthy 
people  choose  to  reside  and* yet  their  fortunes  arise  from  own- 
ership of  property  scattered  throughout  the  country.  The 
present  system  of  State  inheritance  taxes  practically  per- 
mits a  few  States  to  collect  taxes  on  property  whose  value  is 
created  by  many  of  the  States.  A  Federal  inheritance  tax  is 
the  only  method  by  which  the  entire  Nation,  which  contributes 
to  the  value  of  estates,  can  secure  revenues  from  the  values 
which  it  creates. 

The  recommendation  of  returning  50  cents  per  capita  to  the 
States  is  designed  to  induce  them  to  turn  over  to  the  Federal 
Government  the  sole  right  of  imposing  inheritance  taxes  and 
yet  to  preserve  to  the  States  at  least  a  part  of  such  preempted 
claims  as  they  may  have  acquired  by  getting  into  the  field  first. 

The  Federal  machinery  is  already  in  existence  for  collect- 
ing income  taxes,  and  the  same  officials,  without  any  appreci- 
able increase  in  the  number,  can  assess  and  collect  inheritance 
taxes.  Executors  of  estates  whose  annual  incomes  amount  to 
$2500  or  more  per  year  are  now  required  to  make  returns  to 
collectors  of  internal  revenue,  and  the  only  addition  required 
for  an  inheritance  tax  is  that  executors  of  estates  of  $25,000 
should  make  returns  of  the  total  value  of  the  estates.  This 
can,  of  course,  be  done  at  the  same  time  when  they  fill  out  the 
blanks  which  show  net  incomes.  Internal  revenue  officials  also 
investigate  all  cases  where  it  is  suspected  that  full  returns  of 
income  are  not  made.  No  additional  officials  are  therefore  re- 
quired for  these  purposes.  The  only  addition  would  be  such 
number  of  officials  as  are  required  for  general  supervision. 
The  machinery  is  already  in  existence,  and  no  tax  can  be  so 
cheaply  administered  as  a  Federal  inheritance  tax. 

The  significant  feature  of  the  proposed  inheritance  tax  is 


394 

the  high  rates  on  direct  heirs,  as  compared  with  the  very  low 
rates  imposed  in  the  States.  The  estates  going  to  wife  and 
lineal  heirs  include  probably  80  per  cent  to  90  per  cent  of  all 
estates,  and  it  is  therefore  from  such  estates  that  the  largest 
revenues  are  expected.  Such  estates  are  scarcely  touched  by 
American  inheritance  tax  laws.  The  sensationally  high  rates 
imposed  in  some  States  on  estates  going  to  strangers  and  re- 
mote heirs  are  something  of  a  delusion,  for  scarcely  5  per  cent 
of  the  estates  go  to  such  beneficiaries.  The  rates  on  estates 
going  to  strangers  reach  their  highest  figure  at  35  per  cent 
in  California  on  the  excess  over  $1,000,000  and  fall  as  low  as 
5  per  cent  in  Pennsylvania  and  other  States.  But  the  rates  on 
the  excess  over  $1,000,000  going  to  direct  heirs  is  only  10  per 
cent  in  California  and  falls  to  1,  2,  or  3  per  cent  in  most  of  the 
States.  Our  recommendation  affects  mainly  these  estates 
going  to  direct  heirs,  which  are  80  to  90  per  cent  of  all  estates, 
and  the  highest  rate  on  such  estates  is  15  per  cent  on  the  ex- 
cess over  $1,000,000.  This  conforms  more  nearly  to  the  in- 
heritance taxes  of  leading  European  countries  which  would 
yield  according  to  various  estimates  over  $200,000,000  if 
adopted  by  the  Federal  Government  of  this  country. 

The  following  administrative  reasons  for  making  the  in- 
heritance tax  a  Federal  tax  are  submitted  by  Professor  T.  S. 
Adams,  of  the  Wisconsin  Tax  Commission,  who  also  suggests 
the  repayment  to  States  as  a  method  of  inducing  them  to  yield 
to  the  Federal  tax.    He  says : 

1.  The  present  system  gives  rise  to  a  large  amount  of 
double  or  multiple  taxation  and  if  the  existing  laws  were 
enforced,  the  situation  would  be  unbearable.  Most  State 
laws  tax  the  transfer  of  all  securities  owned  by  resident 
decedents  and  yet  attempt  to  tax  the  transfer  of  some  se- 
curities owned  by  nonresident  decedents  when  they  rep- 
resent property  in  the  State  passing  the  law.  I  have 
known  one  block  of  railroad  stock  to  be  assessed  in  "Wis- 
consin (residence  of  decedent),  in  Illinois  (where  the  stock 
was  deposited  in  a  trust  company),  and  in  Utah,  where  the 
railroad  was  incorporated,  and  it  is  not  unlikely  that 


395 

other  States  through  which  the  railroad  passed  imposed  a 
tax  before  the  estate  was  finally  settled.  Four  different 
and  conflicting  taxes  are  thus  in  use  at  the  present  time. 

2.  The  present  administration  of  such  laws  is  costly, 
ineffective,  unjust  and  capricious.  Wisconsin  attempts 
to  tax  the  transfer  of  all  securities  representing,  however 
indirectly,  property  in  Wisconsin.  It  is  impossible  where 
holding  companies  hold  the  stock  in  the  companies  imme- 
diately owning  the  Wisconsin  property.  To  enforce  it, 
particularly  where  bonds  are  concerned,  agents  must  be 
employed  outside  the  State.  We  keep  two — in  New  York 
and  Chicago.  We  should  have  an  agent  in  every  place  in 
the  country  where  estates  are  probated.  To  enforce  the 
Wisconsin  interpretation  would  cost  an  enormous  sum. 

3.  Yet  the  Western  States  are  insisting  on  the  Wis- 
consin idea  in  inheritance  taxation.  As  they  do  so,  double 
taxation  and  cost  of  administration  must  increase  greatly. 
Cost  of  administration  has  not  been  excessive  in  the  past, 
merely  because  the  laws  have  not  been  enforced. 

4.  Except  in  a  few  States  the  yield  of  the  inheritance 
tax  is  very  irregular.  The  proposed  commutation  pay- 
ment by  the  Federal  Government  would  substitute  a  reg- 
ular for  an  irregular  State  revenue,  besides  greatly  de- 
creasing cost  of  collection — or  prospective  cost  of  collec- 
tion. 

5.  Rich  men  change  their  rendezvous  very  easily. 
Rhode  Island  and  a  few  other  States  do  not  tax  inher- 
itances at  present.  They  do  and  can  prevent  the  proper 
development  of  inheritance  taxes  in  other  States.  It  is 
the  compulsion  of  the  "twentieth  man." 

6.  A  number  of  States  can  not  employ  progressive  rat- 
ing in  inheritance  taxation— an  essential  attribute  of 
sound  inheritance  taxation. 


396 


IMMIGRATION. 

19.  Underlying  the  entire  problem  of  self-government  in 
this  country,  and  placing  a  limit  on  the  ability  to  remedy 
abuses  either  through  politics  or  labor  unions,  is  the  great 
variety  of  races,  nationalities,  and  languages.  We  know  how 
the  Southern  States  have  dealt  with  the  problem  and  how 
constitutional  amendments  forced  upon  them  by  the  Northern 
States  have  been  treated.  Considering  this  outcome  it  is 
doubtful  whether  the  additional  proposed  amendments  de- 
signed to  protect  rights  of  individuals  in  those  or  other  States 
would  accomplish  the  ends  intended. 

A  similar  problem  is  forced  upon  us  by  the  large  immigra- 
tion of  backward  races  or  of  classes  from  other  countries  with 
no  experience  in  self-government.  One  of  these  races,  the 
Chinese,  has  been  actually  excluded  from  immigration.  Oth- 
ers, less  competent,  are  admitted.  The  doctrine  of  a  haven  for 
the  oppressed  has  been  rejected  in  the  case  of  the  Chinese 
and  can  not  consistently  be  raised  against  restriction  on  immi- 
gration designed  to  accomplish  a  similar  purpose  of  protec- 
tion to  Americans.  Especially  is  the  problem  of  the  American- 
ized element  in  the  labor  unions  in  maintaining  discipline  al- 
most insoluble  when  it  comes  to  dealing  with  ten,  twenty  or 
thirty  races  or  languages.  The  right  of  employers  to  bring 
aliens  into  their  establishments  is  the  same  as  their  right  to 
bring  in  naturalized  or  native  Americans.  The  resulting  sit- 
uation is  the  great  strikes  recently  entered  upon  without  pre- 
vious organizations  or  discipline  by  nationalities  that  have 
suddenly  come  together,  notwithstanding  their  racial  antipa- 
thies and  language  impediments,  on  account  of  a  united  antag- 
onism against  their  employers.  Such  strikes  receive  but  little 
consideration  from  American  police,  sheriffs  and  militia,  and 
are  usually  defeated.  On  account  of  their  incapacity  for  self- 
government  it  might  perhaps  be  shown  that  in  isolated  com- 
munities the  paternal  despotism  of  a  corporation  is  preferable 
to  unionism  or  political  control  by  these  backward  national- 
ities.   The  violation  of  contracts  and  inability  of  their  leaders 


397 

to  maintain  discipline  and  observe  contracts,  which  make  some 
American  employers  so  determined  against  recognizing 
unions,  may  often  be  traced  back  to  the  unruly  mixture  of 
races  and  nationalities  whom  they  have  employed.  Other 
problems,  such  as  those  of  the  political  franchise,  must  be 
taken  into  account  in  any  measure  designed  to  further  restrict 
immigration,  but  we  are  convinced  that  very  substantial  re- 
strictions on  immigration,  in  addition  to  the  present  restric- 
tions, should  be  adopted,  and  that  comprehensive  measures 
should  be  taken  to  teach  the  English  language  and  otherwise 
"Americanize"  the  immigrants.  One  of  the  principal  serv- 
ices of  American  trade  unions  is  their  work  in  teaching  immi- 
grants the  practice  of  democratic  government.  They  might 
almost  be  named  as  the  principal  Americanizing  agency.  An- 
other promising  measure  is  the  so-called  social  center,  de- 
signed to  use  the  school  houses  and  public  buildings  for  in- 
struction and  discussion  outside  school  hours.  Such  a  meas- 
ure, if  adopted  by  all  States  as  has  been  done  by  some,  would 
be  of  advantage  also  to  native  Americans  in  the  free  discussion 
of  public  questions. 

Since  immigration  is  one  of  the  principal  issues  between 
capital  and  labor,  its  administration  should  be  turned  over  to 
the  proposed  Federal  Industrial  Commission  where  capital 
and  labor  will  have  an  equal  voice.  This  would  place  all  ad- 
ministrative positions  in  the  service,  up  to  and  including  the 
Commissioner  General,  under  the  Civil  Service  Rules  pro- 
posed in  Paragraph  3.  In  1905,  when  a  trade  union  man  was 
Commissioner  General,  he  was  required  by  the  administration 
to  give  written  or  oral  instructions  to  inspectors  not  to  make 
any  arrests  of  Chinese  for  deportation,  as  required  by  law. 
(Washington  File  15427-1-C.)  Instead  of  resigning  and  mak- 
ing public  protest  he  yielded  and  gave  the  required  instruc- 
tions, which  practically  nullified  the  law  by  preventing  the 
deportation  of  smuggled  Chinese.  Had  such  orders  been  re- 
quired to  be  submitted  to  the  Advisory  Council,  as  proposed  in 
these  recommendations,  a  public  protest  would  have  been  made 
by  the  labor  members  of  the  Council,  since  they  would  be  re- 


398 

sponsible  to  their  unions  and  not  to  the  Government  for  their 
salaries.  Even  now,  with  the  many  charges  of  Chinese  smug- 
gling, the  presence  of  unsalaried  labor  representatives  on  an 
Advisory  Council,  with  the  right  to  have  access  to  all  the  rec- 
ords and  to  have  all  orders  submitted  to  them  before  issuing, 
would  place  them  in  a  position  to  prevent  such  secret  viola- 
tions of  the  law.  In  addition  they  would  receive  through  their 
fellow-unionists  throughout  the  country,  complaints  or  evi- 
dence against  inspectors  supposed  to  be  in  conspiracy  with 
Chinese  smugglers,  and  would  be  in  position  to  present  their 
charges  and  to  require  investigation  and  removal  if  necessary. 
Various  outside  commissions,  including  this  Commission,  have 
been  required  to  investigate  the  matter  of  Chinese  smuggling, 
but  they  are  baffled.  The  Advisory  Council  proposed  would  be 
a  continuous  commission  not  terrified  by  any  political  admin- 
istration and  having  a  voice  in  the  appointment  and  removal 
of  inspectors  under  Civil  Service  Rules.  (See  Paragraph  3.) 
Doubtless  appeals  from  the  Commission  to  the  Department  of 
State  and  the  President  should  be  allowed  in  cases  involving 
political  refugees  and  the  interpretation  of  treaties  with  for- 
eign countries.  These  are  substantially  our  conclusions  de- 
rived from  the  attempted  investigation  of  Asiatic  smuggling. 


FARMERS  AND  FARM  LABORERS. 

20.  One  of  the  growing  evils  to  be  feared  is  the  increasing 
congestion  of  populated  centers  at  the  expense  of  the  rural 
districts.  This  is  true  not  only  of  America  but  also  of  Europe. 
The  allurements  of  the  city  tend  to  draw  annually  thousands" 
from  the  country  to  the  city.  Congested  cities,  especially  in 
hard  times,  mean  enlarged  ranks  of  the  unemployed. 

This  tendency  is  strengthened  where  the  struggle  of  the 
small  farmer,  not  only  to  hold  on  to  his  land  but  to  make  a 
living,  becomes  hopeless;  and  where  the  conditions  are  such 
that  the  farm  laborer  or  the  farm  tenant  sees  little  or  no  pos- 
sibility of  becoming  a  future  land-owner. 

Not  least  among  the  causes  of  higher  cost  of  living  has 


399 

been  the  tendency  to  increase  city  populations  at  the  expense 
of  agricultural  populations,  thus  decreasing  relatively  the  sup- 
ply and  increasing  the  demand,  and  thereby  inevitably  raising 
the  cost  of  food. 

The  last  census  shows  that  we  are  becoming  the  victims  of 
increasing  absentee  landlordism  and  farm  tenancy.  It  points 
out  that  while  the  number  of  farm  owners  during  the  preced- 
ing decade  increased  8  per  cent,  the  number  of  farm  tenants 
increased  16  per  cent.  If  this  ratio  should  continue  for  a  few 
more  decades,  many  parts  of  our  Republic  will  find  themselves 
in  the  condition  from  which  Ireland  has  so  recently  emerged. 

For  many  generations  Ireland  was  one  of  the  most  dis- 
tressed countries  in  the  world.  All  of  its  evils  were  due  pri- 
marily to  absentee  landlords  and  farm  tenants.  But  within 
the  last  decade  a  wonderful  change  has  taken  place  in  the 
social  and  economic  condition  of  the  Irish  peasant,  brought 
about  by  the  enactment  by  Parliament  of  what  has  since  be- 
come known  as  the  Irish  Land  Bill.  This  Act  created  a  Royal 
Commission,  with  power  to  appraise  the  large  Irish  land  es- 
tates owned  by  absentee  landlords,  at  their  real  and  not  at 
their  speculative  value,  to  buy  them  in  the  name  of  the  Gov- 
ernment at  the  appraised  value,  plus  12  per  cent  bonus,  to 
cut  them  up  into  small  parcels,  to  sell  them  to  worthy  farm 
tenants,  giving  some  seventy  years'  time  in  which  to  make 
small  annual  payments  on  the  amortization  plan,  the  deferred 
payments  bearing  but  3  per  cent  interest.  In  addition  to  this, 
the  Government  made  personal  loans  to  peasants  sufficient  to 
cover  the  cost  of  stock  and  farm  implements,  also  payable  in 
small  annual  installments  bearing  a  minimum  rate  of  interest. 
The  Government  further  furnished  the  various  farm  districts 
with  farm  advisors,  trained  graduates  from  agricultural  col- 
leges, who  act  as  friend,  adviser,  and  scientific  farm  instructor 
to  the  peasants.  Within  a  decade  the  wretched  and  more  or 
less  law-breaking  farm  tenant  has  been  converted  into  an  in- 
dustrious, progressive,  and  law-abiding  landed  proprietor, 
In  fact,  he  has  become  so  law-abiding  that  many  jails  in  the 
farming  districts,  formerly  filled  with  agrarian  criminals, 
have  been  converted  into  public  schools. 


400 

In  Texas  this  Commission  found  a  condition  of  farm  ten- 
ancy like  that  of  Ireland  and  seemingly  typical  of  growing 
conditions  in  various  parts  of  the  country.  We  therefore  rec- 
ommend to  Congress  and  to  the  various  States,  that  steps 
shall  be  taken  to  lighten  the  burdens  of  the  small  farmer,  and 
make  it  more  possible  to  encourage  the  tenant,  farm  laborer, 
and  city  dweller,  to  become  land  proprietors. 

Not  least  among  the  burdens  of  the  small  farmer  is  the 
great  difficulty,  as  a  rule,  on  his  part  in  obtaining  the  neces- 
sary credit  with  which  to  better  and  to  improve  his  land,  at  a 
low  rate  of  interest  and  under  terms  that  will  permit  him  to 
make  payments  spread  over  a  long  term  of  years. 

Under  the  rural  credits  system  of  Germany  a  small  farmer 
can  borrow  his  money  as  cheaply  as  can  a  great  banker.  Not 
only  can  he  do  this,  but  he  can  spread  the  payments  over  a 
period  of  thirty  or  more  years.  It  is  this  system  of  rural  cred- 
its, among  other  things,  that  has  made  it  possible  for  the  Ger- 
man farmer,  despite  the  high  price  of  his  land,  his  heavy  taxes, 
and  his  small  acreage,  not  only  to  successfully  compete  with 
the  American  farmer,  but  to  enjoy  a  fair  degree  of  prosperity; 
so  much  so  that  in  more  recent  times  there  have  been  compara- 
tively few  German  agriculturists  who  have  emigrated  to  this 
country. 

We  therefore  recommend  that  Congress  and  the  various 
States  pass  rural  credit  acts  that  will  give  to  the  small  Amer- 
ican farmer  the  same  privileges  and  benefits  that  for  so  long  a 
time  have  been  enjoyed  by  the  small  farmers  in  Germany  and 
other  European  countries,  which,  following  Germany,  have 
adopted  rural  credit  systems.  We  recommend  serious  consid- 
eration to  adapting  the  Irish  Land  Bill  and  the  Australian  Sys- 
tem of  State  Colonization  to  our  American  conditions.  It  is  not 
our  intention,  in  this  report,  to  enter  into  minute  details  as  to 
how  this  should  be  carried  out.  In  a  general  way,  however, 
we  believe  it  not  only  desirable,  but  practicable,  for  the  Fed- 
eral Government,  through  its  Department  of  Agriculture,  and 
the  various  States,  through  their  Departments  of  Agriculture, 
to  secure  large  bodies  of  land  at  appraised  actual  values,  that 


401 

have  been  thoroughly  tested  by  experts  for  their  quality,  is- 
suing bonds  for  the  payment  for  same,  if  need  be,  and  to' cut 
them  up  into  small  parcels,  making  the  necessary  improve- 
ments, and  selling  them  to  qualified  colonists  with  small  first 
payments,  making  the  balance  payable  in  say  thirty  years  on 
the  amortization  plan,  the  deferred  payments'  bearing  only  the 
same  rate  of  interest  that  the  Government  itself  is  called  upon 
to  pay,  plus  a  small  addition  to  cover  the  cost  of  Government 
administration.  We  believe,  in  this  way,  the  most  effective 
check  can  be  created  on  the  one  hand  to  minimize  farm  ten- 
ancy, and  on  the  other  hand  to  make  it  possible  for  the  farm 
laborer  and  the  farm  tenant  to  become  land  proprietors.  We 
believe  that  this,  if  carried  out  wisely  and  intelligently,  will 
have  a  large  share  in  minimizing  industrial  unrest  and  in  add- 
ing to  the  wealth  of  the  Nation,  both  materially  and  in  the 
quality  of  its  citizenship. 

CORPORATION  CONTROL. 

21.  Corporation  control  over  politics  and  labor  has  for  a 
long  time  been  a  well-known  matter  of  serious  concern  in  all 
American  States.  This  Commission  has  held  hearings  on  the 
subject  of  such  control  in  isolated  communities  at  Lead,  S.  D., 
Butte,  Mont.,  and  in  Colorado,  and  other  communities  were 
partly  investigated  by  a  member  of  the  staff. 

In  Lead  we  found  a  strong  union  had  recently  been  driven 
out  on  account  of  its  sudden  demand  for  the  closed  shop,  and 
this  was  followed  by  a  paternal  absolutism  that  controlled 
labor,  business  and  politics.  In  Butte  we  found  a  strong  union 
split  into  factions  and  destroying  its  own  property,  followed 
by  refusal  of  the  corporation  to  deal  with  either  faction.  In 
Colorado  we  found  a  long  history  of  refusals  to  deal  with 
unions,  accompanied  by  strikes  at  intervals  of  nine  or  ten 
years.  In  each  of  these  cases  the  ownership  and  control  of  the 
property  was  in  the  hands  of  absentees,  who  left  the  operat- 
ing management  to  executives  on  the  ground. 

We  condemn  the  conditions  found  in  Colorado  which  show 


402 

the  control  of  corporations  over  labor  and  politics,  and  we 
find  there  a  system  that  has  taken  hold  throughout  the  coun- 
try. Here  the  serious  problem  is  not  the  personality  of  any 
individual  who  may  or  may  no't  be  responsible,  but  the  cor- 
rection of  a  system  which  has  grown  up  mainly  under  absentee 
ownership  and  which  determines  the  acts  of  individuals  ac- 
cording to  their  self-interest  within  the  terms  prescribed  by 
the  system.  Immediate  and  public  action  is  necessary  to  see 
that  courts  of  justice  are  not  prostituted  to  the  service  of  one 
class  against  another,  but  the  huge  system  of  corporate  con- 
trol requires  more  far-reaching  remedies  before  attain- 
ment. Absentee  ownership  can  not  be  brought  to  the  sense  of 
its  responsibility  without  the  enactment  and  adequate  enforce- 
ment of  workmen's  compensation  for  accidents  and  occupa- 
tional diseases,  sickness,  invalidity,  and  old  age  insurance. 
Meanwhile  a  partial  method  of  meeting  its  responsibility  is  a 
staff  of  safety,  health  and  labor  commissioners,  independent 
of  the  local  executive  staff,  to  report  directly  to  the  Board  of 
Directors.  The  work  of  such  a  staff  is  directly  in  conflict  with 
that  of  the  executive  staff,  for  the  latter  must  get  out  ''pro- 
duction" while  the  other  must  acquaint  the  Directors  and 
company  with  the  oppression  of  labor  which  increased  pro- 
duction and  lower  costs  often  bring.  The  labor  department 
can  not  be  made  subordinate  to  the  executive  department  if 
the  corporation  really  intends  to  safeguard  its  employees. 

We  are  not  in  favor  of  public  ownership  as  solely  a  matter 
of  improving  labor  conditions,  and  before  such  can  be  recom- 
mended there  should  be  a  more  complete  investigation  and 
regulation  and  a  clearing  up  of  the  values  that  will  be  paid 
and  the  administrative  control  that  will  follow.  More  imme- 
diate and  necessary,  is  a  series  of  laws  that  will  take  the  con- 
trol of  politics  out  of  the  hands  of  corporations  and  place  it 
in  the  hands  of  the  people.  Several  of  our  previous  recom- 
mendations are  intended  to  accomplish  this  purpose  in  so  far 
as  labor  and  capital  are  concerned,  but  we  should  add,  effect- 
ive corrupt  practices  acts,  designed  to  protect  the  secret  bal- 
lot, to  limit  the  amount  of  money  and  number  of  paid  elec- 
tioneers in  elections,  to  prevent  intimidation,  and  so  on,  as 


403 

far  as  elections  are  menaced  by  political  machines  and  wealth. 
Direct  primaries  for  the  nomination  of  candidates,  protected 
by  corrupt  practices  acts.  Constitutional  and  legislative  in- 
itiative for  State  and  Federal  Governments.  The  initiative 
would  permit  the  people  to  change  the  constitution  at  any  point 
where  the  courts  had  depended  upon  it  for  a  decision,  and 
would  make  unnecessary  any  provision  for  recall  of  Supreme 
Court  judges  or  of  their  decisions,  or  of  taking  from  higher 
courts  their  power  to  declare  laws  unconstitutional.  The  re- 
call of  elected  officials,  including  executives  and  judges  of  the 
lower  courts,  but  not  judges  of  the  Supreme  Courts  or  mem- 
bers of  the  legislature.  Proportional  representation,  as 
adopted  in  Belgium,  South  Africa,  Australia  and  the  Irish 
parliament,  by  which  all  parties  or  factions  would  be  able  to 
elect  their  own  representative  in  the  legislatures  or  Congress 
in  proportion  to  their  numbers  and  without  making  deals  with 
other  parties.  This  would  permit  a  labor  party  to  have  its 
representatives,  as  well  as  other  minor  parties,  and  would  per- 
mit women,  who  we  consider  should  have  the  suffrage,  and 
other  minor  parties  to  elect  their  own  representatives  without 
making  compromises  in  order  to  get  the  votes  of  the  major 
parties.  These  minor  parties,  containing  as  they  do  the  ad- 
vanced views  on  labor  and  social  problems,  are  entitled  to  their 
proportionate  share  of  influence  in  the  legislatures  or  Con- 
gress. It  can  be  seen  that  such  a  measure  would  take  away 
from  corporations  much  of  their  present  inducement  to  con- 
trol the  great  parties.  It  would  furnish  a  legislature  which 
would  be  a  true  reflection  of  the  wishes  of  all  the  people.  This 
recommendation  applies  to  the  legislature  the  principle  of  rep- 
resentation of  interests  which  we  advance  in  the  case  of  the 
Advisory  Council  to  the  Industrial  Commission. 

John  R.  Commons. 
Florence  J.  Harriman. 
Harris  Weinstock.1 
S.  Thruston  Ballard.1 
Richard  H.  Aishton.2 


1 — See  supplementary  reports. 

2 — See  supplementary  report.     Appointed  Commissioner  March  17,  1915,  to 
serve  the  unexpired  term  of  Hon.  F.  A.  Delano,  resigned. 


404 

Note. — Commissioner  Weinstock  also  presented  the  follow- 
ing dissenting  opinion : 

I  dissent  from  the  Report  prepared  by  Commissioner  Com- 
mons on  the  question  of  immigration.  That  report  says, 
"We  are  convinced  that  very  substantial  restrictions  on  im- 
migration, in  addition  to  the  present  restrictions,  should  be 
adopted." 

I  am  of  the  opinion  that  we  have  abundant  immigration 
laws  already  on  our  statute  books  which  if  enforced  will  keep 
out  of  the  country  unfit  immigrants.  In  normal  times  this 
country  can  profitably  employ  all  the  desirable  and  fit  occi- 
dental immigrants  that  knock  at  our  door,  thereby  adding 
greatly  to  the  wealth  and  the  strength  of  the  Nation. 

Harris  Weinstock. 


Report  of  Commissioners  Weinstock, 
Ballard  and  Aishton 


407 


REPORT  OF  COMMISSIONERS  WEINSTOCK, 
BALLARD  AND  AISHTON. 


We  concur  in  the  report  prepared  by  Commissioner  Com- 
mons, dissenting,  however,  on  the  two  following  points,  and 
supplementing  it  by  certain  other  findings  and  recommenda- 
tions following  herewith. 

First.  We  dissent  from  the  recommendation  that  the  sec- 
ondary boycott  should  be  legalized.  We  regard  the  secondary 
boycott  as  unjust,  inequitable,  and  vicious,  in  that  it  subjects 
third  and  innocent  parties  to  injury  and,  at  times,  to  great 
loss,  if  not  ruin.  We  are,  therefore,  as  much  opposed  to  it  as 
we  are  to  the  blacklist.  There  have  been  instances  where,  for 
example,  a  strike  would  occur  on  a  newspaper.  The  strikers 
would  demand,  for  example,  that  a  certain  business  house  ad- 
vertising in  such  paper  should,  despite  the  fact  that  it  was 
under  contract,  withdraw  its  patronage,  and  on  refusal  of  the 
advertiser  to  violate  its  contract  with  the  newspaper,  it  be- 
came the  victim  of  boycotts  at  the  hands  of  the  strikers  more 
or  less  injurious,  if  not  disastrous,  in  their  results  to  such  ad- 
vertiser. The  Supreme  Court  of  the  United  States  has,  in  our 
opinion,  wisely  and  justly  declared  the  secondary  boycott 
illegal,  and  we  regard  it  as  an  injury  to  society  to  legalize  a 
system  so  vicious. 

It  has  been  pointed  out  that — 

*  *  *  the  boycott  is  the  chief  weapon  of  modern 
unionism,  and  also  characteristic  generally  of  its  spirit 
and  methods.  A  discussion  of  a  boycott  as  a  mere  with- 
drawal of  patronage  is  idle  and  academic.  When  that  is 
the  extent  of  the  boycott  in  any  particular  case,  the  pat- 
ronage is  simply  withdrawn,  and  nothing  more  is  heard 
about  it.  From  that  simple  procedure  the  modern  boy- 
cott has  been  developed  into  a  very  different  thing,  and 
what  has  become  known  as  the  secondary  boycott,  drag- 


408 

ging  in  third  parties  to  the  dispute,  and  penalizing  them 
for  patronizing  one  of  the  parties  to  the  dispute,  has 
played  an  important  part. 

Dealing  with  this  phase  of  the  question,  Judge  William 
II.  Taft,  in  an  early  case  (1893)  said: 

The  boycott  is  a  combination  of  many  to  cause  a  loss  to 
one  person  by  coercing  others  against  their  will  to  with- 
draw from  him  beneficial  business  intercourse  by  threats 
that  unless  those  others  do  so,  the  many  will  cause  ser- 
ious loss  to  them. 

In  the  case  of  Moore  v.  The  Bricklayers'  Union,  Judge 
William  H.  Taft  says : 

The  conflict  was  brought  about  by  the  effort  of  de- 
fendants to  use  plaintiff's  right  of  trade  to  injure  Parker 
Brothers,  and,  upon  failure  of  this,  to  use  plaintiff's  cus- 
tomers' rights  of  trade  to  injure  the  plaintiff.  Such  effort 
can  not  be  in  the  bona  fide  exercise  of  trade,  is  without 
just  cause,  and  is  therefore  malicious.  The  immediate 
motive  of  defendants  here  was  to  show  to  the  building 
world  what  punishment  and  disaster  necessarily  follows 
a  defiance  of  their  demands.  The  remote  motive  of  wish- 
ing to  better  their  condition  by  the  power  so  acquired  will 
not,  as  we  think  we  have  shown,  make  any  legal  justifica- 
tion for  defendants'  acts.  We  are  of  the  opinion  that  even 
if  acts  of  the  character  and  with  the  intent  shown  in  this 
case,  are  not  actionable  when  done  by  individuals,  they 
become  so  when  they  are  the  result  of  combination,  be- 
cause it  is  clear  that  the  terrorizing  of  a  community  by 
threats  of  exclusive  dealing  in  order  to  deprive  one  ob- 
noxious member  of  means  of  sustenance,  will  become  both 
dangerous  and  oppressive. 

The  Anthracite  Coal  Strike  Commission,  in  its  report,  in 
touching  upon  secondary  boycotts,  says : 

It  was  attempted  to  define  the  boycott  by  calling  the 
contest  between  employers   and   employees   a  war  be- 


409 

tween  capital  and  labor,  and  pursuing  the  analogies  of 
the  word,  to  justify  thereby  the  cruelty  and  illegality  of 
conduct  on  the  part  of  those  conducting  the  strike.  The 
analogy  is  not  apt,  and  the  argument  founded  upon  it  is 
fallacious. 

There  is  only  one  war-making  power  recognized  by  our 
institutions,  and  that  is  the  Government  of  the  United 
States  and  of  the  States  in  subordination  thereto,  when 
repelling  invasion  or  domestic  violence.  War  between 
citizens  is  not  to  be  tolerated,  and  can  not  in  the  proper 
sense,  exist.  If  attempted  it  is  unlawful,  and  is  to  be  put 
down  by  the  sovereign  power  of  the  State  and  Nation. 
The  practices  which  we  are  condemning  would  be  outside 
the  pale  of  civilized  warfare.  In  civilized  warfare,  women 
and  children,  and  the  defenseless,  are  safe  from  attack, 
and  a  code  of  honor  controls  the  parties  to  such  warfare, 
which  cries  out  against  the  boycott  we  have  in  view. 
Cruel  and  cowardly  are  terms  not  too  severe  by  which  to 
characterize  it. 

Second.  We  further  dissent  from  said  report  in  its  limita- 
tion of  public  inquiry  in  labor  disputes  only  to  cases  where 
both  sides  invite  such  inquiry.  We  believe  that  in  the  public 
interest  there  are  times  when  compulsion  in  labor  disputes  is 
thoroughly  justified.  We  feel,  with  organized  labor,  that  there 
should  be  no  restriction  put  upon  the  right  to  strike,  realizing 
as  we  do,  that  the  strike  is  the  only  weapon  which,  in  the  in- 
terest of  labor,  can  be  effectively  and  legally  used  to  aid  in 
bettering  its  conditions.  We  feel,  also,  that  there  should  be 
no  restriction  placed  upon  the  employer  in  his  right  to  declare 
a  lockout  in  order  better  to  protect  what  he  regards  as  his 
interest,  and  we  therefore  would  not  favor  any  plan  that  would 
inflict  penalties  upon  the  worker  or  upon  the  employer  for 
declaring  a  strike  or  lockout. 

Where  the  two  sides  to  a  labor  controversy  are  fairly  well 
balanced  in  strength,  the  winning  side  must  depend,  in  the  last 
analysis,  upon  the  support  of  public  opinion.  Public  opinion, 
therefore,  becomes  a  most  important  factor  in  the  interest  of 


410 

industrial  peace.  Such  public  opinion,  however,  to  be  of  value, 
must  be  enlightened.  Under  prevailing  conditions  this  is  al- 
most impossible.  All  that  the  public  is  now  able  to  get,  as  a 
rule,  are  garbled  and  ex  parte  statements,  more  or  less  mis- 
leading and  unreliable,  which  simply  tend  to  confuse  the 
public  mind. 

Where  strikes  and  lockouts  take  place  on  a  large  scale,  and 
more  especially  in  connection  with  public  utilities,  the  public 
inevitably  becomes  a  third  party  to  the  issue,  in  that  it  has 
more  at  stake  than  both  parties  to  the  dispute  combined.  For 
example,  if  the  street  railways  of  a  large  city  are  tied  up,  the 
loss  to  the  railway  companies  in  the  way  of  revenue,  and  to 
the  workers  in  the  way  of  wages,  is  great,  but  this  loss  be- 
comes insignificant  compared  with  the  loss  inflicted  upon  the 
rest  of  the  community,  to  say  nothing  of  the  annoyance,  in- 
convenience, and  menace  to  life  and  property,  which  not  in- 
frequently occur  in  such  industrial  disputes.  The  public, 
therefore,  as  the  third  party  to  the  issue,  is  justified  in  de- 
manding that  an  investigation  take  place,  and  that  the  facts 
be  ascertained  and  presented  in  an  impartial  spirit  to  the 
general  public,  so  that  ways  and  means  may  be  found  of  ad- 
judicating the  dispute  or  of  throwing  the  influence  of  a  prop- 
erly informed  public  opinion  on  the  side  which  has  the  right 
in  its  favor. 

We,  therefore,  earnestly  recommend  that  in  the  case  of 
public  utilities,  the  proposed  Industrial  Commission  shall  not 
only  have  power  to  mediate  and  conciliate,  but  also,  at  the  re- 
quest of  either  side  to  a  dispute,  or  upon  the  initiative  of  the 
Commission  itself,  should  have  the  power,  all  voluntary  meth- 
ods having  failed,  to  undertake  a  compulsory  public  inquiry 
when,  in  the  discretion  of  the  Commission,  public  interest 
demands  it;  that  it  be  given  the  fullest  powers  to  summon 
witnesses,  place  them  under  oath,  demand  books  and  docu- 
ments, all  with  a  view  of  ascertaining  the  underlying  causes 
of  the  dispute  and  the  issues  involved,  to  the  end  of  making 
recommendations  that,  in  the  judgment  of  the  Board  of  In- 
quiry, consisting  of  three  members,  one  to  be  chosen  by  each 


411 

side  and  the  third  to  be  chosen  by  these  two,  would  be  a  fair 
and  reasonable  settlement  of  the  points  in  dispute.  It  being 
derstood,  however,  that  neither  side  is  obliged  to  accept  such 
recommendations,  but  may  continue  to  strike  or  lock  out,  as  the 
case  may  be.  Meanwhile,  however,  the  public  will  have  ascer- 
tained in  the  most  reliable  way,  the  issues  involved,  the  facts 
as  they  have  been  found  by  the  Board  of  Inquiry,  and  the  basis 
upon  which  a  fair  settlement  can  be  established,  thus  enabling 
the  public  more  intelligently  to  throw  its  support  where  it 
rightfully  belongs. 

With  the  two  foregoing  modifications,  we  heartily  concur  in 
the  report  prepared  by  Commissioner  Commons.  We  desire, 
however,  additionally,  to  report  as  follows: 

We  find  that  the  alleged  findings  of  fact  and,  in  a  general 
way,  the  comments  thereon  made  in  the  report  of  the  staff  of 
this  Commission,  under  the  direction  of  Mr.  Basil  M.  Manly, 
which  has  been  made  a  part  of  the  records  of  this  Commission, 
without  the  endorsement,  however,  of  the  Commission,  so 
manifestly  partisan  and  unfair  that  we  can  not  give  them  our 
endorsement.  What  we  regard  as  the  desirable  recommenda- 
tions in  the  report  of  Mr.  Manly  are  dealt  with  to  our  satisfac- 
tion in  the  Commons  report,  which  has  our  approval. 

We  find  that  Mr.  Manly's  report  places  practically  all  the 
responsibility  for  the  causes  of  industrial  unrest  at  the  doors 
of  one  side,  forgetting  that  both  sides  to  the  issues  are  hu- 
man, and,  being  human,  are  guilty  of  their  fullest  share  of 
wrong-doing,  and  are  alike  responsible  in  greater  or  lesser 
degree,  for  £he  causes  of  industrial  unrest. 

We  are,  therefore,  prompted,  in  the  interest  of  fairness  and 
justice,  to  present  herewith  some  of  the  additional  causes  of 
industrial  unrest  that,  in  the  course  of  the  investigations  and 
public  hearings  of  the  Commission,  have  forced  themselves 
upon  our  attention. 

Despite  the  fact  that  we  have  been  appointed  to  represent, 
on  this  Commission,  the  employers  of  the  Nation,  we  are  free 
to  admit  that  the  investigations  made  by  the  Commission,  and 
the  testimony  brought  forth  at  our  public  hearings,  have  made 


412 

it  plain  that  employers,  some  of  them,  have  been  guilty  of 
much  wrong-doing,  and  have  caused  the  workers  to  have  their 
fullest  share  of  grievances  against  many  employers.  There 
has  been  an  abundance  of  testimony  submitted  to  prove  to  our 
satisfaction  that  some  employers  have  resorted  to  questionable 
methods  to  prevent  their  workers  from  organizing  in  their 
own  self-interest;  that  they  have  attempted  to  defeat  democ- 
racy by  more  or  less  successfully  controlling  courts  and  Legis- 
latures ;  that  some  of  them  have  exploited  women  and  children 
and  unorganized  workers ;  that  some  have  resorted  to  all  sorts 
of  methods  to  prevent  the  enactment  of  remedial  industrial 
legislation;  that  some  have  employed  gunmen  in  strikes,  who 
were  disreputable  characters,  and  who  assaulted  innocent  peo- 
ple and  committed  other  crimes  most  reprehensible  in  char- 
acter ;  that  some  have  paid  lower  wages  than  competitive  con- 
ditions warranted,  worked  their  people  long  hours,  and  under 
insanitary  and  dangerous  conditions;  that  some  have  ex- 
ploited prison  labor  at  the  expense  of  free  labor;  that  some 
have  been  contract-breakers  with  labor;  that  some  have  at 
times  attemped,  through  the  authorities,  to  suppress  free 
speech  and  the  right  of  peaceful  assembly ;  and  that  some  have 
deliberately,  for  selfish  ends,  bribed  representatives  of  labor. 
All  these  things,  we  find,  tend  to  produce  industrial  unrest, 
with  all  its  consequent  and  far-reaching  ills. 

There  is,  therefore,  no  gainsaying  the  fact  that  labor  has 
had  many  grievances,  and  that  it  is  thoroughly  justified  in 
organizing  and  in  spreading  organization  in  order  better  to 
protect  itself  against  exploitation  and  oppression. 

On  the  other  hand,  in  justice  to  employers  generally,  it 
must  be  said  that  there  has  been  much  evidence  to  show  that 
there  is  an  awakening  among  the  enlightened  employers  of 
the  Nation,  who  have  taken  a  deeper  personal  interest  in  the 
welfare  of  their  workers  than  ever  before  in  industrial  his- 
tory; that  such  enlightened  employers  are  growing  in  num- 
ber and  are  more  and  more  realizing  that,  if  for  no  other  rea- 
son, it  is  in  their  own  self-interest  to  seek  the  welfare  of  their 
workers,  and  earnestly  to  strive  to  better  their  conditions. 


413 

Employers,  on  their  own  initiative,  have  created  sick  funds 
and  pension  funds;  have  expended  vast  sums  of  money  to 
insure  greater  safety  to  their  workers;  have,  as  compared 
with  conditions  of  the  past,  greatly  improved  their  methods 
of  sanitation ;  have  done  much  to  regularize  employment ;  have 
increased  wages ;  and  in  every  way  have  endeavored  to  lighten 
the  burdens  of  their  workers. 

While  there  are  many  deplorable  conditions  yet  remaining 
to  be  rectified,  and  while  the  condition  of  the  worker  is  still 
far  from  ideal,  we  believe  that,  on  the  whole,  the  impartial 
investigator  must  find  that,  in  normal  times,  on  the  average, 
the  hours  of  the  American  worker  are  the  shortest,  his  wages 
the  highest,  his  working  conditions  the  most  favorable,  his 
standard  of  living  the  highest,  and  his  general  well-being  the 
best,  in  the  world's  industrial  history. 

Industrial  Commissioner  John  B.  Lennon,  who  is  also  a 
member  of  the  Executive  Council  of  the  American  Federation 
of  Labor,  in  the  absence  of  official  figures  has  estimated  that 
there  are  at  this  time  about  20,000,000  wage  earners  in  the 
United  States,  and  that  about  3,250,000  of  these  are  members 
of  various  labor  unions.  In  other  words,  as  a  liberal  approxi- 
mation, about  16  per  cent  of  the  wage  earners  of  America  are 
members  of  trade  unions. 

Considering  that  the  American  Federation  of  Labor  came 
into  life  in  1881,  some  34  years  ago,  and  considering  the 
earnest  and  zealous  efforts  that  have  been  made  by  its  repre- 
sentatives and  the  representatives  of  other  labor  organiza- 
tions to  agitate,  educate,  and  organize,  and  considering  still 
further  the  highly  commendable  objects  professed  by  organ- 
ized labor,  the  membership  results  are  disappointingly  small. 

One  reason  given  for  the  comparatively  small  percentage 
of  unionists  in  the  ranks  of  labor  is  the  hostility  against  union- 
ism on  the  part  of  many  employers.  Organized  labor  points 
out  that  there  are  many  employers'  associations  that  are  or- 
ganized not  to  deal  with,  but  to  fight,  unionism,  and  that  this, 
in  many  instances,  and  more  especially  in  the  larger  industrial 


414 

enterprises,  presents  a  very  serious  obstacle  for  organized 
labor  to  meet  and  to  overcome. 

Representing  as  we  do  on  this  Commission,  the  employers' 
side,  we  are  at  one  with  the  other  members  of  our  Federal 
Commission  who  represent  the  general  public,  and  also  with 
those  representing  organized  labor,  in  believing  that  under 
modern  industrial  conditions,  collective  bargaining,  when 
fairly  and  properly  conducted,  is  conducive  to  the  best  good 
of  the  employer,  the  worker,  and  society.  We  find  that  there 
are  many  enlightened  employers  who  concur  in  this  view,  who 
in  the  past  recognized  and  dealt  with  organized  labor,  but 
who  now  refuse  to  do  so,  and  who,  under  proper  conditions, 
would  willingly  continue  to  engage  in  collective  bargaining. 
With  good  cause,  in  our  opinion,  however,  they  place  the  re- 
sponsibility for  their  refusing  to  do  so  at  the  door  of  organized 
labor.  There  is  an  abundance  of  available  testimony  in  our 
records  to  show  that  many  employers  are  frightened  off  from 
recognizing  or  dealing  with  organized  labor  for  fear  that  to  do 
so  means  to  put  their  heads  in  the  noose  and  to  invite  the  prob- 
ability of  seriously  injuring,  if  not  ruining,  their  business. 

The  prime  objection  that  such  employers  have  to  recogniz- 
ing and  dealing  with  organized  labor  is  the  fear  of — 

(a)  Sympathetic  strikes. 

{b)  Jurisdictional  disputes. 

(c)  Labor  union  politics. 

(d)  Contract  breaking. 

(e)  Restriction  of  output. 

(/)  Prohibition  of  the  use  of  nonunion  made  tools  and  ma- 
terials. 

(g)     Closed  shop. 

(h)     Contests  for  supremacy  between  rival  unions. 

(i)  Acts  of  violence  against  nonunion  workers  and  the 
properties  of  employers. 

(;)     Apprenticeship  rules. 


415 

While  we  have  found  many  sinners  among  the  ranks  of  the 
employers,  the  result  of  our  investigation  and  inquiries  forces 
upon  us  the  fact  that  unionists  also  can  not  come  into  court 
with  clean  hands ;  that  this  is  not  a  case  where  the  saints  are 
all  on  one  side  and  the  sinners  all  on  the  other.  We  find  saints 
and  sinners,  many  of  them,  on  both  sides. 

The  hope  of  future  industrial  peace  must  lie  in  both  sides 
using  their  best  endeavors  to  minimize  the  causes  that  lead  to 
the  growth  of  sins  and  sinners  on  each  side  of  the  question. 

SYMPATHETIC   STRIKES. 

Taking  up  seriatim  the  objections  offered  by  many  employ- 
ers to  recognizing  and  dealing  with  organized  labor,  we  come 
first  to  that  of  the  sympathetic  strike.  The  employer  con- 
tends, and  we  find  ourselves  in  sympathy  with  his  contention, 
that  it  is  a  rank  injustice  to  subject  him  to  a  strike  of  his  em- 
ployees who  have  absolutely  no  grievances,  to  stop  work  be- 
cause some  other  group  of  workers,  possibly  at  a  remote  point, 
have  a  real  or  fancied  grievance  against  their  own  employer, 
especially  when  such  stoppage  of  work  may  not  only  inflict  a 
very  serious  loss,  but  may  mean  ruin  to  the  enterprise  of  the 
innocent  employer,  thus  making  it,  in  violation  of  all  the  equi- 
ties, a  clear  case  of  punishing  the  many  innocent  for  the  one  or 
the  few  who  may  be  guilty,  who  were  party  to  the  original 
dispute. 

JURISDICTIONAL  DISPUTES. 

The  employer  further  points  out  that  not  only  is  his  busi- 
ness liable  to  be  ruined  by  the  sympathetic  strike,  but,  more 
especially  in  the  building  trades,  is  he  likely  to  become  an 
innocent  victim  of  jurisdictional  disputes  for  which  he  is  in  no 
wise  responsible  and  over  which  he  has  absolutely  no  control. 

Sidney  and  Beatrice  Webb  point  out  that— 

It  is  no  exaggeration  to  say  that  to  the  competition  be- 


416 

tween  overlapping  unions  is  to  be  attributed  about  nine- 
tenths  of  the  ineffectiveness  of  the  trade  union  world.1 

Innumerable  instances  have  occurred  where  jurisdic- 
tional strikes  have  lasted  for  months  and  sometimes  for 
years.2 

The  elevator  constructors  had  a  serious  and  costly  dis- 
pute with  the  machinists  in  Chicago  over  the  installation 
of  pumps  connected  with  hydraulic  elevators.  A  strike 
resulted  for  more  than  two  years,  during  which  most  of 
the  elevator  men  in  the  city  were  out  of  work  while  mem- 
bers of  the  machinists  and  other  unions  supplied  their 
places  with  the  Otis  Elevator  Co.2 

In  1910  the  secretary  of  the  bricklayers  said: 

Our  disputes  with  the  operative  plasterers'  union  dur- 
ing the  past  year  have  taken  thousands  of  dollars  out  of 
our  international  treasury  for  the  purpose  of  protecting 
our  interest.  The  loss  in  wages  to  our  members  has 
amounted  to  at  least  $300,000.  The  loss  to  our  employ- 
ers has  been  up  in  the  thousands,  also.2 

Professor  Commons,  in  his  studies  of  the  New  York  Build- 
ing Trades,  comments  on  the  jurisdictional  disputes  as  fol- 
lows: 

Building  construction  was  continuously  interrupted, 
not  on  account  of  lockouts,  low  wages,  or  even  employ- 
ment of  nonunion  men,  but  on  account  of  fights  between 
the  unions.  A  friendly  employer  who  hired  only  union 
men,  along  with  the  unfriendly  employer,  was  used  as  a 
club  to  hit  the  opposing  union,  and  the  friendly  employer 
suffered  more  than  the  other.3 

The  Chicago  machinery  movers  caused  considerable  delay 
in  the  construction  of  the  Harris  Trust  Building,  and  in 
a  period  of  less  than  a  year  were  responsible  for  no  less 


1 — Industrial  Democracy,  vol.  1,  p.  121. 

1—The  Bricklayer  and  Mason,  Feb.,  1911.  p.  117. 

3 — Trade  Unionism  and  Labor  Problems. 


417 

than  50  separate  strikes,  during  which  the  work  of  the  em- 
ployers was  delayed.* 

Jurisdictional  disputes  waste  both  labor  and  capital 
They  make  it  impracticable  in  many  eases  to  use  improved 
appliances  and  cheaper  materials.  They  are  responsible 
for  hesitancy  in  undertaking  and  increasing  expense  in 
prosecuting  buildings,  to  the  detriment  of  the  building 
industry.* 

Rnally,  where  the  disputes  are  long  continued,  they 
are  responsible  for  that  whole  train  of  evil  results  which 
follows  upon  idleness  and  poverty.* 

Sidney  and  Beatrice  Webb  again  point  out  that  in  the 
industries  of  Tyneside,  within  a  space  of  35  months,  there 
were  35  weeks  in  which  one  or  the'  other  of  the  four  most 
important  sections  of  workmen  in  the  staple  industry  of 
the  district,  absolutely  refused  to  work.  This  meant  com- 
pulsory idleness  of  tens  of  thousands  of  men,  the  selling 
out  of  households,  and  the  semistarvation  of  whole  fam- 
ilies totally  unconcerned  with  the  disputes,  while  it  left 
the  unions  in  a  state  of  weakness  from  which  it  will  take 
years  to  recover.4 

That  wise  and  far-seeing  labor  leaders  keenly  appreciate 
the  great  wrongs  inflicted  not  only  upon  the  employers,  but 
upon  the  workers  themselves,  by  virtue  of  cessation  of  work 
in  jurisdictional  disputes,  is  emphasized  by'  the  following  ex- 
tracts from  the  report  of  Mr.  Samuel  Gompers,  President  of 
the  American  Federation  of  Labor,  at  its  convention  in  1902 : 

Beyond  doubt,  the  greatest  problem,  the  danger  which 
above  all  others  is  threatening  not  only  the  success  but 
the  very  existence  of  the  American  Federation  of  Labor, 

the  question  of  jurisdiction.    Unless  our  affiliated  na- 

1 — Report  on  jurisdictional  disputes  in  Chicago,  1912. 

2— Interview,  Secretary  of  Building  Employers  Association,  Chtragm,  Jury. 

1912. 
3 — Industrial  Democracy,  toL  1,  p.  121, 
4— Ibid..  toL  2,  p.  513. 


418 

tional  and  international  unions  radically  and  soon  change 
their  course,  we  shall,  at  no  distant  date,  be  in  the  midst 
of  an  internecine  contest  unparalleled  in  any  era  of  the  in" 
dustrial  world,  aye,  not  even  when  workmen  of  different 
trades  were  arrayed  against  each  other  behind  barricades 
over  the  question  of  trade  against  trade.  They  naturally 
regard  each  other  with  hatred,  and  treat  each  other  as 
mortal  enemies. 

There  is  scarcely  an  affiliated  organization  which  is  not 
engaged  in  a  dispute  with  another  organization  (and 
in  some  cases,  with  several  organizations)  upon  the  ques- 
tion of  jurisdiction.  It  is  not  an  uncommon  occurrence 
for  an  organization,  and  several  have  done  so  quite  re- 
cently, to  so  change  their  laws  and  claims  to  jurisdiction 
as  to  cover  trades  never  contemplated  by  the  organizers, 
officers,  or  members ;  never  comprehended  by  their  titles, 
trades  of  which  there  is  already  in  existence  a  national 
union.  And  this  without  a  word  of  advice,  counsel,  or 
warning. 

I  submit  that  it  is  untenable  and  intolerable  for  an  or- 
ganization to  attempt  to  ride  rough-shod  over  and  tram- 
ple under  foot  rights  and  jurisdiction  of  a  trade,  the  juris- 
diction of  which  is  already  covered  by  an  existing  or- 
ganization. This  contention  for  jurisdiction  has  grown 
into  such  proportions,  and  is  fought  with  such  an  intensity 
as  to  arouse  many  bitter  feuds  and  trade  wars.  In  many 
instances  employers  fairly  inclined  for  organized  labor 
are  made  innocently  to  suffer  from  causes  entirely  beyond 
their  control. 

As  proof  of  the  prophetic  and  far-sighted  utterances  of 
President  Gompers,  it  has  been  pointed  out  that  "in  1911,  in 
Chicago,  his  grim  prophecy  was  actually  fulfilled  in  the  bitter 
jurisdictional  wars  fought  by  rival  unions  in  that  city,  in  which 
paid  thugs  and  gunmen  turned  the  streets  of  Chicago  into  a 
condition  of  anarchy,  and  in  which,  as  a  mere  incident  from 
the  union  standpoint,  millions  of  dollars  of  construction  work 


419 

remained  idle,  with  a  resultant  loss  to  owners,  contractors,  and 
the  business  interest  of  the  city  beyond  possibility  of  calcula- 
tion." 

We  ask,  what  sane  or  thoughtful  employer  would  willingly 
put  his  head  in  a  noose  such  as  this  by  recognizing  and  dealing 
with  unions,  and  thus  invite  possible  ruin? 

LABOR  UNION  POLITICS. 

The  third  objection  of  employers  to  recognizing  and  deal- 
ing with  organized  labor  is  the  risk  they  run,  especially  in  the 
building  trades,  where  power  to  declare  a  strike  is  concen- 
trated in  the  hands  of  a  business  agent,  of  finding  themselves 
at  the  mercy  of  either  a  corrupt  business  agent  or  one  who, 
for  the  sake  of  union  politics,  is  endeavoring,  in  order  to  per- 
petuate himself  in  office,  to  make  capital  at  the  expense  of  the 
innocent  employer  by  making  unwarranted  and  unreasonable 
demands  against  the  employer. 


CONTRACT  BREAKING. 

The  fourth  reason  offered  by  the  employers  for  refusing  to 
recognize  or  to  deal  with  organized  labor,  is  its  increasing 
unreliability  in  keeping  trade  agreements.  To  give  one  case 
in  point,  our  record  gives  the  story,  in  undisputed  statement 
published  in  the  United  Mine  Workers'  Journal,  which  is  the 
official  organ  of  the  United  Mine  Workers  of  America,  writ- 
ten by  Mr.  W.  0.  Smith,  ex-Chairman  of  the  Executive  Com- 
mittee of  the  Kentucky  District  of  United  Mine  Workers  of 
America,  in  which  Mr.  Smith,  among  other  things,  says : 

Because  of  the  indifference  of  the  conservative  members 
of  our  unions,  and  the  activity  of  the  radical  element  which 
is  responsible  for  the  greatest  menace  which  has  ever 
threatened  the  United  Mine  Workers  of  America,  the  local 
strike,  during  the  past  two  or  three  years  the  interna- 
tional, as  well  as  the  district  and  subdistrict  officials,  have 


420 

been  confronted  with  many  perplexing  problems,  some  of 
which  seem  to  threaten  the  very  life  of  the  organization. 
But  I  believe  I  am  safe  in  saying  that  no  problem  has 
given  them  so  much  concern  as  the  problem  of  local  strikes 
in  violation  of  agreements. 

Thousands  of  dollars  are  expended  every  year  in  an 
effort  to  organize  the  250,000  nonunion  miners  in  the 
United  States,  while  hundreds  of  our  members  go  on  strike 
almost  every  day  in  absolute,  unexcusable  violation  of 
existing  agreements.1 

This  criticism  comes  not  from  an  employer,  but  from  an 
ardent,  earnest  unionist,  in  high  standing  in  his  organization. 

Corroborating  the  statement  of  Mr.  Smith,  comes  a  state- 
ment published  in  Coal  Age  of  December  20,  1913,  issued  by 
the  Association  of  Bituminous  Coal  Operators  of  Central 
Pennsylvania,  addressed  to  Mr.  Patrick  Gilday,  President  of 
District  No.  2,  U.  M.  W.  of  A.,  Morrisville  mines,  Pa.,  dated 
Philadelphia,  December  12, 1913,  in  which,  among  other  things, 
the  following  appears : 

Whereas,  Rules  12  and  13  of  said  agreement  provide, 
"that  should  differences  arise  between  the  operators  and 
mine  workers  as  to  the  meaning  of  the  provisions  of  this 
agreement  or  about  matters  not  specifically  mentioned  in 
this  agreement,  there  shall  be  no  suspension  of  work  on 
account  of  such  difference,  but  an  earnest  effort  be  made 
to  settle  such  differences  immediately. ' p  Whereas,  notwith- 
standing the  fact  that  Rule  15  provides  the  right  to  hire 
and  discharge,  the  management  of  the  mine  and  the  direc- 
tion of  the  working  forces  are  vested  exclusively  in  the 
operator,  the  United  Mine  Workers  of  America  have  abso- 
lutely disregarded  this  rule,  in  that  they  have  at  numerous 
times  served  notices  on  substantially  every  operator  be- 
longing to  our  Association,  that  unless  all  the  employees 
working  for  such  operators  should  become  members  of  the 
union  on  or  before  certain  dates  mentioned  in  said  no- 


1— New  York  Hearings,  U.  S.  Commission  on  Industrial  Relations,  pp.  2750-51. 


421 

tices,  that  they,  the  Mine  Workers,  would  close  or  shut 
down  the  operators'  respective  mines,  and  in  many  in- 
stances did  close  the  mines  for  this  reason,  and  refused 
to  return  to  work  unless  such  nonunion  employees  were 
discharged.  This  conduct  is  in  direct  violation  of  the  con- 
tract, and  specifically  interferes  with  and  abridges  the 
right  of  the  operator  to  hire  and  discharge;  of  the  man- 
agement of  the  mine,  and  of  the  direction  of  the  working 
forces ;  this  conduct  in  violation  of  contract  on  the  part 
of  the  Mine  Workers,  as  well  as  that  mentioned  in  the 
preceding  paragraph,  has  resulted  in  more  than  one  hun- 
dred strikes  during  the  life  of  our  scale  agreement.1 

Numerous  other  illustrations  could  be  given  from  the  rec- 
ords of  the  Commission,  showing  that  there  are  other  instances 
where  unions  did  not  observe  their  contracts,  tending  to  make, 
in  the  minds  of  many  employers,  a  character  for  all  union- 
ism, and  thus  increasing  their  hesitancy  in  recognizing  and 
dealing  with  unions. 


RESTRICTION  OF  OUTPUT. 

Not  least  among  the  reasons  given  by  fair-minded  employ- 
ers for  refusing  to  recognize  or  deal  with  labor  unions,  is  the 
fact  that  many  unions  stand  for  a  limited  output,  thus  mak- 
ing among  their  workers  for  the  dead  level,  and  thereby  mak- 
ing it  impossible  for  the  union  employer  successfully  to  com- 
pete with  the  nonunion  employer,  who  is  not  faced  with  such 
handicap. 

British  industrial  conditions  are  cursed  with  the  practice 
of  limited  output,  as  compared  with  the  absence  of  this  prac- 
tice in  industrial  Germany.  As  a  consequence,  Germany,  in 
time  of  peace,  has  industrially  outrun  Great  Britain  by  leaps 
and  bounds. 

The  British  unionist,  by  practicing  limited  output,  has  thus 

1 — New  York  Hearings,  U.  S.  Commission  on  Industrial  Relations,  pp.  2061-62. 


422 

played  directly  into  the  hands  of  his  keenest  industrial  com- 
petitor, the  German. 

The  records  of  the  Commission  also  show  that  organized 
labor,  almost  as  a  unit,  is  very  strongly  opposed  to  the  in- 
troduction in  industry  of  what  has  become  known  as  Scientific 
Management,  or  Efficiency  Methods.  In  relation  to  this  phase 
of  the  problem,  we  find  ourselves  at  one  with  the  statement 
made  and  the  opinions  expressed  by  Mr.  Louis  D.  Brandeis 
before  the  Commission  at  Washington,  in  April,  1914,  who, 
when  invited  to  express  his  opinion  on  the  question  of  effi- 
ciency standards,  scientific  management,  and  labor,  among 
other  things,  said : 

My  special  interest  in  this  subject  arises  from  the  con- 
viction that,  in  the  first  place,  working  men,  and  in  the 
second  place,  members  of  the  community  generally,  can 
attain  the  ideals  of  our  American  democracy  only  through 
an  immediate  increase  and  perhaps  a  constant  increase, 
in  the  productivity  of  man.  *  *  *  Our  ideals  could  not 
be  attained  unless  we  succeed  in  greatly  increasing  the 
productivity  of  man.  *  *  *  The  progress  that  we  have 
made  in  improving  the  conditions  of  the  working  man 
during  the  last  century,  and  particularly  during  the  last 
fifty  years,  has  been  largely  due  to  the  fact  that  inter- 
vention or  the  introduction  of  machinery  has  gone  so  far 
in  increasing  the  productivity  of  the  individual  man. 
With  the  advent  of  the  new  science  of  management  has 
come  the  next  great  opportunity  of  increasing  labor's 
share  in  the  production,  and  it  seems  to  me,  therefore, 
of  the  utmost  importance,  not  only  that  the  science  should 
be  developed  and  should  be  applied  as  far  as  possible,  but 
that  it  should  be  applied  in  cooperation  with  the  represen- 
tatives of  organized  labor,  in  order  that  labor  may  now, 
in  this  new  movement,  get  its  proper  share. 

I  take  it  that  the  whole  of  this  science  of  management 
is  nothing  more  than  an  organized  effort,  pursued  inten- 
sively, to  eliminate  waste.  *  *  *  It  is  in  the  process  of 
eliminating  waste  and  increasing  the  productivity  of  man, 


423 

to  adopt  those  methods  which  will  insure  the  social  and 
industrial  essentials,  fairness  in  development,  fairness  in 
the  distribution  of  the  profits,  and  the  encouragement  to 
the  working  man  which  can  not  come  without  fairness. 

I  take  it  that  in  order  to  accomplish  this  result,  it  is 
absolutely  essential  that  the  unions  should  be  represented 
in  the  process.  *  *  *  When  labor  is  given  such  a  rep- 
resentation, I  am  unable  to  find  anything  in  Scientific 
Management  which  is  not  strictly  in  accord  with  the  inter- 
ests of  labor,  because  it  is  nothing  more  than  fair,  through 
the  application  of  these  methods  which  have  been  pursued 
in  other  branches  of  science,  to  find  out  the  best  and  the 
most  effective  way  of  accomplishing  the  result.  It  is  not 
making  men  work  harder— the  very  effort  of  it  is  to  make 
them  work  less  hard,  to  accomplish  more  by  what  they 
do,  and  to  eliminate  all  unnecessary  motion,  to  give  spe- 
cial effort  and  special  assistance  to  those  who,  at  the  time 
of  the  commencement  of  their  work,  are  mostly  in  need 
of  the  assistance  because  they  are  less  competent. 

*  *  *  As  I  view  the  problem,  it  is  only  one  of  mak- 
ing the  employer  recognize  the  necessity  of  the  participa- 
tion of  representatives  of  labor  in  the  introduction  and 
carrying  forward  of  the  work,  and  on  the  other  hand, 
bringing  to  the  working  man  and  the  representatives  of 
organized  labor,  the  recognition  of  the  fact  that  there  is 
nothing  in  Scientific  Management  itself  which  is  inimical 
to  the  interests  of  the  working  man,  but  merely  perhaps 
the  practices  of  certain  individuals,  of  certain  employers 
or  concerns  who  have  engaged  in  it. 

I  feel  that  this  presents  a  very  good  opportunity  for 
organized  labor.  It  seems  to  me  absolutely  clear,  as  Scien- 
tific Management  rests  upon  the  fundamental  principles 
of  advance  in  man's  productivity,  of  determining  what 
the  best  way  was  of  doing  a  thing,  instead  of  the  poor 
way,  of  a  complete  coordination  and  organization  of  the 
various  departments  of  business,  that  the  introduction  of 
Scientific  Management  in  our  businesses  was  certain  to 


424 

come ;  that  those  who  oppose  the  introduction  altogether 
are  undertaking  a  perfectly  impossible  task;  and  that 
if  organized  labor  took  the  position  of  absolute  opposi- 
tion, instead  of  taking  the  position  of  insisting  upon  their 
proper  part  in  the  introduction  of  this  system,  and  the  con- 
duct of  the  business  under  it,  organized  labor  would  lose 
its  greatest  opportunity,  and  would  be  defeating  the  very 
purpose  for  which  it  exists. 

On  being  asked  the  question  what,  in  his  opinion,  would 
be  the  status  of  unionism  in  the  event  of  Scientific  Manage- 
ment becoming  a  common  industrial  condition,  Mr.  Brandeis 

said: 

I  think  there  would  be  a  great  deal  left  for  unionism  to 
do,  and  do  not  think  the  time  will  come  when  there  will 
not  be,  as  long  as  there  is  a  wage  system  in  existence. 
*  *  *  I  do  not  feel  that  we  have  reached  the  limit  of 
the  shorter  day,  certainly  not  in  some  employments,  nor 
do  I  think  we  have  reached  the  limit  of  the  higher  wage ; 
*  certainly  we  have  not  reached  the  limit  of  the  best  condi- 
tions of  employment  in  many  industries. 

All  of  these  subjects  are  subjects  which  must  be  taken 
up,  and  should  be  taken  up  by  the  representatives  of  the 
men  and  women  who  are  particularly  interested.  There 
will  be  work  for  unions  to  do  as  long  as  there  is  a  wage 
system. 

Mr.  Brandeis  further  stated  that  he  saw  no  menace  to  union- 
ism in  Scientific  Management,  and  that  he  favored  labor  hav- 
ing a  voice  in  determining  all  the  factors  involved  in  Scientific 
Management. 

In  answer  to  the  question  if  he  thought  the  fears  groundless 
on  the  part  of  organized  labor,  in  looking  upon  Scientific 
Management  as  a  menace  to  unionism,  he  answered  saying — 

Yes,  groundless  except  for  this — I  think,  for  instance, 
that  the  existence  of  the  system  of  Scientific  Management, 
unless  the  unions  choose  to  cooperate  with  the  effort  to  in- 


425 


stall  it,  may  menace  unionism,  because  the  most  efficient 
and  advanced  employers  may  adopt  it,  whether  the  unions 
like  it  or  not,  and  in  that  way  these  establishments  may 
become  successful,  and  be  so  buttressed  by  their  success 
as  to^  be  able  to  exclude  unions  from  their  business. 
That  is  the  menace,  if  they  do  not  take  part,  but  if  they 
cooperate  it  seems  to  me  it  simply  advances  unionism. 

Mr.  Brandeis  confirmed  the  thought  that  if  unionism  is  wise 
it  will  make  the  most  of  its  opportunity  by  enlisting  its  co- 
operation in  the  movement,  and  will  endeavor  to  bring  Scien- 
tific Management  to  its  highest  possibility  at  the  earliest 
day,  in  order  that  it  may  better  share  the  increased  surplus 
created  by  such  Scientific  Management,  and  that  for  unions 
to  work  against  it  is  in  the  nature  of  a  colossal  error.  The 
testimony  of  Miss  Ida  Tarbell  on  this  point  was  in  full  accord 
with  that  of  Mr.  Brandeis. 


PROHIBITION  OF  USE  OF  NONUNION  MADE  TOOLS 
AND  MATERIAL. 

The  sixth  reason  offered  by  employers  for  refusing  to  rec- 
ognize or  to  deal  with  organized  labor,  is  that  when  they 
do  so  they  are  often  not  permitted  to  use  nonunion  made 
tools  or  materials,  thus  placing  upon  themselves  a  burden 
and  a  hardship  from  which  nonunion  employers  are  free,  and 
thus  also  laying  themselves  liable  to  get  into  all  sorts  of  con- 
troversies with  the  union,  which  are  vexatious,  annoying,  time- 
losing,  and,  frequently,  most  costly,  as  they  sometimes  lead  to 
grave  and  serious  strikes. 


CLOSED  SHOP. 

The  seventh  reason  why  many  employers  refuse  to  recognize 
or  to  deal  with  organized  labor  (and  among  these  may  be 
mentioned  the  employers  of  large  bodies  of  workers  who  have 


426 

previously  had  trade  agreements  with  organized  labor)  is  the 
matter  of  the  closed  shop. 

Many  such  employers  are  quite  willing  to  recognize  and  to 
deal  with  unions  upon  a  tacit  or  written  open  shop  agree- 
ment, but  they  have  no  confidence,  based  on  their  previous 
experience,  that  an  open  shop  agreement  will  be  respected  by 
the  unions.  Such  employers  labor  under  the  fear  that,  despite 
an  open  shop  agreement  or  understanding,  the  union,  at  its 
first  opportunity,  will  force  them  to  compel  the  nonunion 
worker  to  join  the  union.  Employers  such  as  these  are  un- 
willing to  place  themselves  in  the  position  where  the  union 
can  control  them  despite  an  open  shop  agreement  or  under- 
standing, and,  so  to  speak,  put  a  pistol  to  their  heads  and  com- 
mand them  in  turn  to  command  a  nonunion  worker,  on  pain 
of  dismissal,  to  join  the  union.  Such  employers  feel  that, 
having  an  open  shop  agreement  or  understanding,  if,  for  any 
reason,  a  worker  does  not  choose  to  join  the  union,  they,  as  em- 
ployers, should  no  more  compel  him  to  do  so  than  they  would 
compel  him  to  join  any  particular  fraternal  society  or  religious 
body.  They  feel  that  if  they  are  working  under  an  open  shop 
agreement  or  understanding,  and  such  nonunion  worker  is 
capable,  efficient,  and  has  rendered  long  and  faithful  service, 
that  they  are  doing  him  and  themselves  a  great  injustice  either 
to  force  him  into  a  union  or  to  discharge  him  because  he  will 
not  join  a  union. 

Where  an  employer  enters  into  an  agreement  with  a  union 
which  does  not  stipulate  that  only  union  men  shall  be  em- 
ployed, but  leaves  the  employer  free  to  employ  exclusively 
union  men,  or  some  union  and  some  nonunion  men  as  he  may 
prefer,  so  long  as  he  maintains  for  all  men  union  conditions, 
that  in  such  an  event  the  union  has  no  right  to  demand  that 
the  nonunionist  should  be  compelled  by  the  employer  to  join 
the  union  or  a  strike  will  follow.  For  the  union,  under  such 
conditions,  to  strike,  as  it  has  done  notably  in  the  Pennsyl- 
vania coal  fields,  and  as  pointed  out  also  by  W.  0.  Smith,  ex- 
Chairman  of  the  Executive  Committee  of  the  Kentucky  Dis- 
trict of  the  United  Mine  Workers  of  America,  whose  state- 


427 

ments  have  been  quoted  herein,  is  a  violation,  on  the  part  of 
the  union,  of  its  contract. 

It  may  be  held  that  unionists  working  under  an  open  shop 
agreement  or  understanding  always  reserve  to  themselves  the 
right,  for  any  reason  or  for  no  reason,  to  cease  to  work  along- 
side of  nonunion  men,  and  that  they  further  reserve  the  right 
to  determine  the  psychological  moment  at  which  it  is  in  their 
interest  to  cease  work  or  to  go  on  a  strike  because  they  will 
not  work  alongside  of  nonunion  men.  It  is  the  fear  of  the 
likelihood  of  their  doing  this  that  frightens  off  many  em- 
ployers from  recognizing  or  dealing  with  organized  labor. 
They  feel  that  even  when  they  are  operating  under  an  open 
shop  agreement  or  understanding,  which  does  not  deny  them 
the  right  to  employ  nonunion  men  so  long  as  they  work  under 
union  conditions,  they  are  working  with  a  sword  suspended 
over  their  heads  by  a  slender  thread,  which  may  break  at  any 
moment,  and  are  liable  to  have  a  strike  on  their  hands  at  the 
most  critical  time,  which  may  spell  ruin  for  their  business. 
Employers,  as  a  rule,  do  not  deem  it  a  good  business  policy 
to  invite  such  risks. 

An  impressive  example  of  this  policy  on  the  part  of  or- 
ganized labor  was  brought  out  in  the  testimony  taken  by  the 
Commission  at  Lead,  S.  D.  Superintendent  Grier  of  the  Home- 
stake  Mining  Company,  Lead,  S.  D.,  at  the  hearing  held  by 
the  Commission  at  that  point  in  August,  1914,  stated  that 
he  had  recognized  and  dealt  with  the  Lead  City  Miners' 
Union  from  1877  to  1909,  with  the  understanding  that  they 
were  at  liberty  to  employ  union  or  nonunion  men  as  they 
preferred.  Late  in  October,  1909,  a  resolution  was  published 
in  the  daily  papers  that  on  and  after  the  25th  of  November, 
1909,  members  of  the  Federation  would  not  work  with  those 
working  for  the  Homestake  Mining  Company  who  failed  and 
neglected  to  become  members  of  the  union  in  good  standing; 
and  in  consequence,  on  the  25th  of  November,  the  mine  was 
closed  down,  and  from  that  day  on  the  company  has  not  recog- 
nized nor  dealt  with  organized  labor. 

We  are,  however,  of  the  opinion  that  where  an  employer 


428 

enters  into  an  agreement  with  a  union  which  stipulates  that 
only  union  men  shall  be  employed,  a  thing  which  he  has  both 
a  moral  and  a  legal  right  to  do,  the  nonunion  worker,  in  that 
event,  can  have  no  more  reason  to  find  fault  with  the  employer 
in  declining  to  employ  him,  than  a  certain  manufacturer  would 
have  if  the  employer,  for  reasons  satisfactory  to  himself, 
should  confine  his  purchases  to  the  product  of  some  other 
manufacturer. 


CONTESTS  FOR  SUPREMACY  BETWEEN  RIVAL 

UNIONS. 

Testimony  has  been  given  before  this  Commission  indicat- 
ing, in  more  than  one  instance,  that  contests  between  rival 
unions,  or  factions  of  the  same  union,  have  led  to  strikes 
causing  industrial  unrest  from  which  the  worker  as  well  as 
the  employer,  has  suffered  harm  and  loss. 

ACTS  OF  VIOLENCE  AGAINST  NONUNION  WORKERS 
AND  THE  PROPERTIES  OF  EMPLOYERS. 

The  ninth  objection  raised  on  the  part  of  the  employers 
against  unionism,  which  has  been  substantiated  abundantly  by 
investigation  and  by  testimony  taken  by  the  Commission,  is 
the  resort  on  the  part  of  unionists  to  violence  in  labor  trou- 
bles, and  to  the  fact  that  unionists  condone  such  violence  when 
committed  in  the  alleged  interest  of  labor. 

The  most  notable  case,  of  course,  in  modern  industrial  his- 
tory, is  that  of  the  Structural  Iron  Workers,  which  resulted 
in  the  plea  of  guilty  on  the  part  of  the  McNamara  brothers, 
for  the  blowing-up  of  the  Los  Angeles  Times  Building,  killing 
over  twenty  innocent  people,  and  which  further  resulted  in 
Frank  Ryan,  the  President  of  the  Structural  Iron  Workers' 
National  Union,  and  a  group  of  other  labor  union  officials, 
being  convicted  and  sentenced  to  prison. 

As  a  matter  of  fact,  the  bringing  into  life  of  this  United 


429 

States  Commission  on  Industrial  Relations  was  due  primarily 
to  the  long  series  of  crimes  committed  at  the  instance  of  the 
Structural  Iron  Workers'  Union,  which  culminated  in  the 
blowing-up  of  the  Los  Angeles  Times  Building,  with  its  at- 
tendant loss  of  life  of  innocent  citizens,  and  which  aroused  a 
state  of  public  sentiment  demanding  that  an  investigation 
be  made  by  an  impartial  Federal  body,  to  inquire  into  the 
underlying  causes  of  industrial  unrest,  the  existence  of  which 
seemed  to  be  evidenced  by  the  violent  activities  on  the  part  of 
labor  in  various  parts  of  the  country. 

Vincent  St.  John,  Secretary  of  the  Industrial  Workers  of 
the  World,  in  his  testimony  before  the  Commission  on  Indus- 
trial Relations  at  a  public  hearing  in  New  York,  said  that  he 
believed  in  violence  when  it  was  necessary  to  win.  He  said 
that  if  the  destruction  of  property  seemed  necessary  to  bring 
results,  then  he  believed  in  the  destruction  of  property. 

A.  Johannsen  of  California,  State  Organizer  for  the  Build- 
ing Trades  of  California,  and  General  Organizer  for  the 
United  Brotherhood  of  Carpenters,  in  his  testimony  before  the 
United  States  Commission  on  Industrial  Relations  at  Wash- 
ington in  May,  1915,  in  speaking  of  the  reelection  of  Frank 
Ryan,  President  of  the  National  Structural  Iron  Workers' 
Union,  among  other  things  thanked  the  Lord  that  the  union 
had  the  courage  to  reelect  him  President  after  he  had  been 
convicted  as  a  participant  in  the  dynamiting  crimes  of  the 
Structural  Iron  Workers.  He  further  expressed  the  hope  that 
it  was  true  that  the  convicted  dynamiters,  after  being  re- 
elected to  office  by  the  Iron  Workers,  were  met  by  a  proces- 
sion of  applause  at  Fort  Leavenworth  while  on  their  way  to 
prison,  and  that  President  Ryan  performed  his  official  duties 
while  there,  and  rendered  his  official  reports  as  President  of  a 
union  of  10,000  members  and  a  part  of  the  American  Fed- 
eration of  Labor. 

In  contradistinction  to  the  opinion  of  Mr.  Johannsen,  to  the 
effect  that  he  thanked  the  Lord  that  the  union  had  the  courage 
to  reelect  Frank  Ryan  President  after  he  had  been  convicted 
as  a  participant  in  the  dynamiting  crimes  of  the  Structural 


430 

Iron  Workers,  we  have  the  opinion  of  Dr.  Charles  W.  Eliot, 
President  Emeritus  of  Harvard  University,  who,  in  his  tes- 
timony before  the  United  States  Commission  on  Industrial 
Relations  at  New  York,  January  29th,  1915,  in  referring  to 
this  very  instance,  said,  in  answer  to  the  question  as  to  how 
he  regarded  the  action  of  the  Structural  Iron  Workers'  Union 
in  reelecting  Frank  Ryan  President  after  his  conviction  of 
crime,  "As  a  serious  moral  offense  against  the  community  as 
a  whole."1 

Speaking  about  respecting  court  labor  injunctions,  Witness 
Johannsen  said : 

I  don't  think  the  power  of  an  injunction  goes  much  beyond 
the  courage  of  those  who  are  enjoined.  I  think  that  if  a 
person  is  convinced  in  his  own  mind  and  his  own  feelings 
that  his  case  is  just,  that  his  demands  for  an  increase  of 
wages,  or  whatever  the  fight  may  be — if  you  think  and 
feel  you  are  right,  why  then  go  ahead.  Never  mind  about 
those  pieces  of  paper.2 

On  being  asked  whether  he  (Johannsen)  believed  that  Frank 
Ryan,  President  of  the  Structural  Iron  Workers'  National 
Union,  and  his  associates,  were  innocent  men  railroaded  to 
prison,  he  said  that  he  did,  and  that  he  was  satisfied  they 
never  committed  any  crime  against  labor  or  a  better  society, 
and  were  therefore  unjustly  convicted.  This  was  his  atti- 
tude, despite  his  attention  having  been  called  to  the  opinion 
and  decision  rendered  by  the  Circuit  Court  of  Appeals,  in- 
cluding Judges  Baker,  Seaman,  and  Kohlsaat,  against  whose 
integrity  and  fairness  no  whisper  had  ever  been  heard,  and 
who  seemingly  went  into  the  evidence  in  the  dynamiting  cases 
most  exhaustively  and  carefully,  and  who,  among  other  things, 
in  their  decision,  said — 

The  facts  thus  recited,  as  proven  by  the  Government 
on  the  trial,  may  be  mentioned  in  part  as  follows:    Al- 


1 — New  York  Hearings,  U.  S.  Commission  on  Industrial  Relations,  p.  1907. 
2 — Washington  Hearings,  May,  1915,  U.  S.  Commission  on  Industrial  Rela- 
tions, p.  958. 


431 

most  100  explosions  thus  occurred,  damaging  and  destroy- 
ing buildings  and  bridges  in  process  of  erection  where  the 
work  was  being  done  by  open  shop  concerns,  and  no  ex- 
plosions took  place  in  connection  with  work  of  a  similar 
character,  where  the  work  was  done  by  closed  shop  con- 
cerns. *  *  *  In  connection  with  this  work  of  destruc- 
tion, dynamite  and  nitro-glycerine  was  purchased  and 
stolen,  and  various  storage  places  arranged  to  conveni- 
ently store  such  explosives  which  were  to  be  used  in  the 
destruction  of  property  in  the  various  States  referred  to. 
*  *  *  Large  quantities  of  dynamite  and  nitro-gly- 
cerine were  at  various  times  stored  in  the  vaults  of  the 
Association  at  Indianapolis,  and  also  in  the  basement  of 
the  building.  *  *  *  Four  explosions  occurred  in  one 
night  at  the  same  hour  in  Indianapolis,  and  explosions 
were  planned  to  take  place  on  the  same  night,  two  hours 
apart,  at  Omaha,  Neb.,  and  Columbus,  Ind.,  and  the  ex- 
plosions so  planned  did  occur  on  the  same  night,  at  about 
the  same  time,  instead  of  two  hours  apart,  owing  to  the 
fact  that  one  clock  was  defective.  *  *  *  All  the  dyna- 
mite and  nitro-glycerine  *  *  *  including  the  expenses 
incident  to  the  stealing  of  the  dynamite,  were  paid  out 
of  the  funds  of  the  International  Association,  and  these 
funds  were  drawn  from  the  Association  upon  checks 
signed  by  the  Secretary-Treasurer,  John  J.  McNamara, 
and  the  President,  Frank  M.  Ryan,  plaintiff  in  error. 

The  written  correspondence  on  the  part  of  many  of  the 
plaintiffs  in  error  *  *  *  furnish  manifold  evidence  not 
only  of  understanding  between  the  correspondents  of  the 
purposes  of  the  primary  conspiracy,  but  many  thereof 
convey  information  or  direction  for  the  use  of  the  ex- 
plosives, while  others  advise  of  the  destruction  which  has 
occurred,  and  each  points  unerringly  not  only  to  the  un- 
derstanding that  the  agency  therein  was  that  of  the  con- 
spirators, but  as  well  to  the  necessary  steps  in  its  per- 
formance of  transporting  the  explosives  held  for  such 
use.    This  line  of  evidence  clearly  tends  to  prove,  and  may 


432 

well  be  deemed  convincing  of  the  fact  on  the  part  of 
many,  if  not  all,  of  the  correspondents. 

Plaintiff  Frank  M.  Ryan  was  President  of  the  Associa- 
tion and  of  its  Executive  Board,  and  was  active  manager 
and  leader  of  the  contest,  and  policies  carried  on  through- 
out the  years  of  the  strike  and  destructive  explosions  in 
evidence.  Letters  written  and  received  by  him  at  various 
stages  of  the  contest  clearly  tend  to  prove  his  familiarity 
with  and  management  of  the  long  course  of  destroying 
open  shop  structures,  however  guarded  in  expression. 
He  was  at  the  headquarters  of  the  Association  for  the 
supervision  of  operations  periodically,  usually  two  or 
three  days  each  month,  uniformly  attended  the  meetings 
there  of  the  Executive  Board,  and  made  frequent  visits 
to  the  field  of  activities.  *  *  *  He  signed  all  of  the 
checks  in  evidence  for  payments  for  expenditures  for  pur- 
chase, storage,  and  conveyance  of  explosives.  *  *  * 
Many  other  letters  in  evidence,  both  from  and  to  him, 
however  disguised  in  terms,  may  well  authorize  an  in- 
ference of  his  complete  understanding  of,  and  complicity 
for,  the  explosions,  both  in  plans  and  execution.1 

Masses  of  testimony  were  filed  with  the  Commission  to  prove 
that  organized  labor  at  times  resorted  to  a  policy  of  lawless- 
ness. Among  other  documents  may  be  cited  a  magazine  under 
the  title  of  A  Policy  of  Lawlessness,  a  partial  record  of  riot, 
assault,  murder,  and  intimidation,  occurring  in  strikes  of  the 
Iron  Molders'  Union,  during  1904-5-6-7,  published  by  the  Na- 
tional Founders '  Association,  in  which  are  given,  as  a  partial 
list  taken  from  court  records,  a  great  number  of  instances  of 
violence  on  the  part  of  labor  unionists  in  labor  disputes ;  and 
also  a  document  published  as  a  report,  submitted  by  the  Com- 
mittee on  Labor  Disputes  of  the  Cleveland  Chamber  of  Com- 
merce, entitled  Violence  in  Labor  Disputes,  giving  hundreds 
of  instances  where  unionists  had  resorted  to  violence  in  labor 
troubles  in  that  community  alone. 

1 — Washington  Hearings,  May  1915,  U.  S.  Commission  on  Industrial  Relations, 
pp.  1004-13. 


433 

Mr.  Luke  Grant,  special  investigator  for  the  United  States 
Commission  on  Industrial  Relations,  in  his  report  to  the  Com- 
mission on  the  National  Erectors'  Association  and  the  Inter- 
national Association  of  Bridge  and  Structural  Iron  Workers, 
says: 

Do  they  [the  unions]  believe  in  violence?  They  did  not 
destroy  property  and  they  don't  know  who  did.  They 
probably  adopted  resolutions  denouncing  the  unknown 
perpetrators,  and  offering  a  reward  for  their  arrest  and 
conviction.  The  Western  Federation  of  Miners,  in  con- 
vention, offered  a  reward  for  the  arrest  of  the  men  who 
blew  up  the  Independence  depot  in  June,  1904,  killing 
14  men.  Harry  Orchard  afterward  confessed  that  he 
and  Steve  Adams  did  it,  acting  as  agents  for  the  officers 
of  the  union. 

In  this  way  do  union  men  collectively  approve  of  vio- 
lence, that  few  if  any  of  them  would  individually  permit, 
(p.  148.) 

Referring  to  the  industrial  war  between  the  National  Erec- 
tors'  Association  and  the  Structural  Iron  Workers'  Union, 
Mr.  Grant  continues  to  say : 

When  the  hopelessness  of  the  situation  became  apparent 
to  the  union  officials,  resort  was  made  to  the  destruction 
of  property.  Diplomacy  was  out  of  the  question,  so  dyna- 
mite was  tried,    (p.  150.) 

The  report  of  Luke  Grant  brings  out  the  fact  that  the  Struc- 
tural Iron  Workers  had  no  grievances  against  their  employers 
in  the  matter  of  wages,  hours,  or  working  conditions.  The 
only  question  at  issue  was  that  of  the  closed  shop.  To  enforce 
the  closed  shop,  the  Structural  Iron  Workers  seemed  to  feel 
themselves  justified  in  dynamiting  over  one  hundred  prop- 
erties and  destroying  many  innocent  lives. 

Police  Commissioner  Arthur  Woods,  of  the  City  of  New 
York,  in  his  testimony  before  the  United  States  Commission 
on  Industrial  Relations,  in  May,  1915,  at  Washington,  D.  C, 


434 

speaking  of  violence  by  labor  unions,  among  other  things 

said: 

The  result  of  our  investigation  shows  a  course  of  pro- 
cedure like  this :  There  would  be  a  strike  and  the  strik- 
ers would  retain  some  gunmen  to  do  whatever  forcible  or 
violent  work  they  needed.  The  employer,  to  meet  this 
violence,  would  in  a  comparatively  small  percentage  of 
cases,  and  not  as  many  cases  as  the  gunmen  were  em- 
ployed on  the  other  side,  hire  a  private  detective  agency. 
The  function  that  the  gunmen  were  to  perform  was  to 
intimidate  the  workers  that  were  hired  to  take  the  place 
of  the  strikers.  *  *  *  There  were  three  indictments  for 
murder  in  the  first  degree. 

The  question  was  asked  Police  Commissioner  Woods  in  how 
far  his  investigations  had  warranted  the  statement  that  ap- 
peared in  the  New  York  Herald  of  May  14,  1915,  reading  as 
follows : 

Several  of  the  indictments  mentioned  assault  upon  mem- 
bers of  the  union,  and  in  this  connection  District  Attorney 
Perkins  said  last  night  that  the  reign  of  lawlessness 
was  caused  by  union  leaders  who  wished  to  perpetuate 
themselves  in  power,  who  hired  assailants  to  assault  con- 
tenders in  their  own  unions  for  their  places,  and  who  used 
their  union  offices  to  extort  blackmail  under  threats  from 
employers.  Seven  men  are  indicted  for  assault  in  a  riot 
for  control  of  the  union.  Four  men  are  indicted  for  hiring 
Dopey  Benny's  men  to  go  to  a  nonunion  factory  and 
rough-house  the  employees  as  they  left,  and  wreck  the 
plant.    A  dozen  workers  were  wounded  in  that  fight. 

Six  union  men  are  accused  of  extortion  and  assault  in 
using  violence  to  collect  a  fine  of  $100  upon  an  employer. 
Four  others  are  accused  of  hiring  the  Dopey  Benny  band 
to  shoot  up  a  nonunion  factory.  Many  shops  were  fired. 
The  factory  suffered  a  damage  of  $1000  and  several  per- 
sons were  injured.  Other  indictments  mentioned  cases 
where  the  band  was  employed  by  union  leaders  to  attack 


435 

nonunion  workers,  to  wreck  factories,  and  even  to  assault 
nonunion  men  who  opposed  the  leaders,     (pp.  964-5.) 

To  all  of  the  foregoing,  Police  Commissioner  Woods  replied, 
"That  is  the  general  line  of  things  that  we  found." 

One  of  the  ablest  and  clearest-headed  exponents  of  the  cause 
of  labor  that  testified  before  this  Commission  was  Morris 
Hillquit  of  New  York.  In  speaking  of  violence  in  labor  trou- 
bles, he  is  quoted  as  saying,1  that  the  resort  to  violence  and 
lawbreaking  was  "ethically  unjustifiable  and  tactically  sui- 
cidal." Mr.  Hillquit  pointed  out  that  wherever  any  group 
or  section  of  the  labor  movement  "has  embarked  upon  a 
policy  of  'breaking  the  law'  or  using  'any  weapon  which  will 
win  a  fight,'  whether  such  policy  was  styled  'terrorism,'  'pro- 
paganda' of  the  deed,  'direct  action,'  'sabotage,'  or  'anarch- 
ism,' it  has  invariably  served  to  destroy  the  movement,  by 
attracting  to  it  professional  criminals,  infesting  it  with  spies, 
leading  the  workers  to  needless  and  senseless  slaughter,  and 
ultimately  engendering  a  spirit  of  disgust  and  reaction." 

Robert  Hunter,  commenting  on  the  foregoing  statement 
made  by  Morris  Hillquit,  says  (p.  viii) : 

It  will,  I  think,  be  clear  to  the  reader  that  the  history 
of  the  labor  movement  during  the  last  half  century  fully 
sustains  Mr.  Hillquit's  position. 

APPRENTICESHIP  RULES. 

The  question  of  apprenticeships  has  led  to  much  industrial 
strife  and  consequent  industrial  unrest,  where  unions  have 
arbitrarily  determined  the  number  of  apprentices  that  the  em- 
ployer may  take  on. 

Where  this  practice  has  prevailed  the  union  employer  has, 
in  competition  with  the  nonunion  employer,  been  seriously 
handicapped.  The  remedy  for  this  evil  lies  obviously  in  a 
joint  agreement  under  the  direction  of  the  proposed  State  In- 

1— Robert  Hunter,  Violence  and  the  Labor  Movement,  p.  viii. 


436 

dustrial  Commissions,  in  which  each  side  has  an  equal  voice 
in  determining  the  proper  quota  of  apprentices  to  be  em- 
ployed. 

In  conclusion,  it  is  our  desire  to  point  out  that  organized 
labor  is  chargeable  with  its  fullest  share  of  creating  causes 
of  industrial  unrest,  because  of  its  sympathetic  strikes,  its 
jurisdictional  disputes,  its  labor  union  politics,  its  contract 
breaking,  its  resort  to  violence  in  time  of  trouble,  its  policy 
of  limited  output,  and  its  closed  shop  policy.  There  is  an 
abundance  of  evidence  in  the  records  of  the  Commission  to 
show  that  organized  labor  is  also  guilty  of  intimidating  courts, 
more  especially  the  lower  criminal  courts,  to  deal  lightly  with 
labor  offenders  charged  with  criminal  assaults  in  labor  trou- 
bles ;  and  that  some  judges,  more  especially  in  the  lower  courts, 
toady  to  organized  labor  for  vote-getting  purposes,  and  dis- 
miss union  labor  men  guilty  of  law  breaking,  or  impose  on 
them  nominal  penalties  out  of  all  proportion  to  the  crimes 
committed. 

These  various  policies  have  brought  about  their  fullest 
share  among  the  workers,  to  say  nothing  of  the  injury  inflicted 
on  employers  and  on  society,  of  poverty,  suffering,  wretched- 
ness, misery,  discontent,  and  crime.  Organized  labor  will 
never  come  into  its  own,  and  will  indefinitely  postpone  the 
day  when  its  many  commendable  objects  will  be  achieved  in 
the  broadest  sense,  until  it  will  cut  out  of  its  program  sym- 
pathetic strikes,  until  it  can  prevent  cessation  of  work  in  juris- 
dictional disputes,  until  it  can  more  successfully  prevent  labor 
union  politics,  until  it  can  teach  many  in  its  rank  and  file  to 
regard  more  sacredly  their  trade  agreements,  until  it  can 
penalize  its  members  for  resorting  to  violence  in  labor  dis- 
putes, and  until  it  can  make  it  a  labor  union  offense  to  limit 
output. 

Organized  labor  may  ask,  "If  we  cut  out  the  evil  policies 
complained  of  from  our  program,  what  offensive  and  defensive 
weapons  will  be  left  us  with  which  to  protect  ourselves  against 
the  unfair  employ  err* 


437 

The  answer  is  that  when  labor  is  effectively  organized,  it 
has  two  most  powerful  weapons  at  its  command  that  the  em- 
ployer, as  a  rule,  dreads  and  fears  because  of  the  great  damage 
these  weapons  can  inflict  on  him,  namely,  the  strike  and  the 
primary  boycott,  both  of  which  are  within  the  moral  and  legal 
rights  of  the  worker  to  use. 

Generally  speaking,  the  evils  complained  of  have  been  elimi- 
nated from  the  program  of  the  railway  brotherhoods.  As  a 
consequence,  railway  managers  do  not  hesitate  to  recognize 
and  to  deal  with  the  railway  unions,  to  their  mutual  advan- 
tage and  satisfaction,  with  the  result  that  collective  bargain- 
ing has  become  the  common  condition  in  the  railway  world. 
Railway  strikes  and  lockouts  have  now  become  most  infre- 
quent, and  industrial  unrest  due  to  these  causes  in  this  sphere 
of  activity  has  become  greatly  minimized. 

If  these  evils  are  eliminated  by  organized  labor  from  its 
program,  much  will  have  been  done  to  stimulate  collective  bar- 
gaining and  to  minimize  the  existing  causes  of  industrial 
unrest.  The  remedies  for  all  these  evils  do  not  lie  with  the 
employer ;  they  rest  wholly  and  solely  with  unionists.  The  re- 
sponsibility for  the  growth  of  these  evils,  in  our  opinion,  rests 
primarily  with  unionists  who  neglect  their  union  duties,  and 
who  are  as  unmindful  of  their  duties  as  union  men  as  are  many 
voters  of  their  civic  duty  who  remain  at  home  on  election  day. 
We  have  faith  in  the  honesty  of  purpose,  in  the  fairness  of 
spirit,  and  in  the  law-abiding  character'  of  the  American 
worker,  and  we  do  not  believe  that  the  rank  and  file  of  Amer- 
ican wage  earners  are  in  favor  of  many  of  the  practices  of 
some  unions  which  have  subjected  unionism  to  so  much  severe, 
but  just,  criticism.  We  believe  it  is  the  duty  of  each  unionist 
regularly  to  attend  the  meetings  of  his  union,  in  order  that 
democracy  shall  prevail  in  trade  unions  instead  of  an  autoc- 
racy or  despotism,  which  inevitably  follows  where  the  best 
membership  fails  to  attend  union  meetings,  and  thus  permits 
the  affairs  of  the  organization  to  get  into  the  hands  of  in- 
competent, ill-judging,  or  dishonest  officials,  who,  for  their 
selfish  ends,  abuse  the  power  and  authority  vested  in  them. 


438 

Wherever  there  are  found  honest,  high-minded,  clear  headed, 
labor  leaders — and  in  the  course  of  our  investigations  and 
hearings  we  have  come  into  close  personal  touch  with  many 
such  as  these,  who  have  commanded  our  esteem  and  respect — 
it  will  be  found  that,  as  a  rule,  they  represent  unions  where 
the  better  membership  takes  a  lively  and  active  interest  in 
the  welfare  of  the  association,  and  regards  it  as  a  sacred  duty 
to  regularly  attend  its  meetings. 

We  say  frankly  that  if  we  were  wage  earners  we  would 
be  unionists,  and  as  unionists  we  should  feel  the  keen  re- 
sponsibility of  giving  the  same  attention  to  our  trade  union 
duties  as  to  our  civic  duties. 

The  ideal  day  in  the  industrial  world  will  be  reached  when 
all  labor  disputes  will  be  settled  as  a  result  of  reason,  and 
not  as  a  result  of  force.  This  ideal  day  can  be  hastened  if 
the  employers,  on  the  one  hand,  will  earnestly  strive  to  place 
themselves  in  the  position  of  the  worker,  and  look  at  the  con- 
ditions not  only  through  the  eye  of  the  employer  but  through 
the  eye  of  the  worker;  and  if  the  worker  will  strive  to  place 
himself  in  the  position  of  the  employer,  and  look  at  the  con- 
ditions not  only  through  the  eye  of  the  worker  but  through  the 
eye  of  the  employer. 

This,  of  course,  means  the  strongest  kind  of  organization  on 
both  sides.  It  means  that  employers  must  drive  out  of  the 
ranks  of  their  associations  the  law  breaker,  the  labor  contract 
breaker,  and  the  exploiter  of  labor.  It  also  means  that,  in  the 
interests  of  fairness,  every  Board  of  Directors  of  an  industrial 
enterprise  should  have  within  its  organization  a  committee 
for  the  special  purpose  of  keeping  the  Board  of  Directors  ad- 
vised as  to  the  condition  of  their  workers.  And  it  finally 
means  that  trade  unions  must,  in  order  to  minimize  the  causes 
of  industrial  unrest,  among  other  things  remove  the  weak  spots 
in  unionism  set  forth  herein,  thereby  hastening  the  day  when 
employers  will  no  longer  fear  to  recognize  and  deal  with 
unions,  and  when  collective  bargaining  shall  thus  become  the 
common  condition. 

Finally,  we  feel  that  employers,  individually  and  through 


439 

their  associations,  in  common  with  thoughtful  representatives 
of  labor,  should  give  their  fullest  share  of  thought  and  lend 
their  heartiest  cooperation  in  aiding  to  solve,  through  con- 
structive legislation  and  other  ways,  the  great  problems  of 
vocational  education,  continuation  schools,  woman  and  child 
labor,  apprenticeship,  hours  of  labor,  housing,  sickness  in- 
surance, workmen's  compensation,  safety  measures,  old  age 
pensions,  and  unemployment.  The  hope  is  therefore  expressed 
that  employers  will  strive  to  work  with  rather  than  against 
intelligent  labor  representatives  in  aiding,  through  these  va- 
rious movements,  to  lessen  industrial  unrest  and  to  still  fur- 
ther improve  the  condition  of  wage  earners  and  their  depend- 
ents. 

Hakbis  Weinstock. 

S.  Thruston  Ballard. 

Richard  H.  Aishton.1 


1— Appointed   Commissioner  March   17,  1915,  to  serve  unexpired  term  of  Ho.. 
F.  A.  Delano,  resigned. 


Supplemental    Statement   of    Commissioner 
S.  Thruston  Ballard 


443 


SUPPLEMENTAL  STATEMENT  OF  COMMISSIONER 
S.  THRUSTON  BALLARD. 

The  law  creating  the  United  States  Commission  on  Indus- 
trial Relations,  in  addition  to  other  things  says:  "The  Com- 
mission shall  seek  to  discover  the  underlying  causes  of  dis- 
satisfaction in  the  industrial  situation  and  report  its  conclu- 
sions thereon.' ' 

The  causes  of  industrial  unrest  may  be  put  under  five  main 
groups : 

First — Low  wages. 

Second — Unemployment,  through  seasonal  occupations, 
periods  of  depression,  accidents  and  sickness. 

Third — The  development  of  large  industries. 

Fourth — Long  working  hours  and  insanitary  condi- 
tions. 

Fifth — Unsatisfactory  rural  conditions. 
I  will  analyze  each  of  these  groups  separately. 

First :  Low  wages  with  all  the  attendant  evils  I  consider 
the  prime  cause  for  industrial  unrest. 

One  of  the  chief  factors  in  wage  depression  is  undoubtedly 
the  encouraged,  stimulated  and  probably  assisted  immigra- 
tion, which  has  brought  to  our  shores  millions  of  unskilled 
workers  in  the  last  few  years.  These  immigrants  coming  from 
those  countries  where  vastly  lower  wage  rates  prevail,  de- 
velop in  America  a  wage  competition  of  which  the  employer 
naturally  takes  advantage. 

The  European  War  will  probably  relieve  this  immigration 
situation  for  the  next  few  years,  but  it  is  a  question  to  which 
our  Government  must  give  serious  consideration  in  the  near 
future. 

Inefficiency  of  the  unskilled  worker  is  also  a  contributory 


444 

cause  of  low  wages.  The  average  applicant  for  work  is  ir- 
responsible and  untrained. 

With  all  our  vaunted  free  school  system,  our  industrial 
education  is  deplorable.  In  our  large  cities,  they  are  beginning 
to  consider  the  question  seriously,  but  our  rural  schools  are 
lamentably  deficient.  This  inefficiency,  which  tends  to  lower 
the  whole  standard,  can  be  corrected  only  through  improved 
educational  facilities. 

Government  assistance  should  be  given  to  aid  in  the  estab- 
lishment of  Vocational,  Trade  and  Continuation  Schools,  as 
a  part  of  our  public  school  system. 

The  gravitation  of  industries  into  large  units  has  caused 
the  skilled  worker  to  be  supplanted  by  the  unskilled,  who  be- 
comes merely  a  cog  in  the  wheel  of  the  great  machine,  per- 
forming the  monotonous  duties  that  anyone  could  easily  do 
after  a  few  weeks  practice. 

The  wages  of  the  unskilled  laborer  are  so  pitifully  small 
that  it  is  almost  impossible  for  him  to  maintain  a  family  even 
with  the  most  rigid  economy. 

I  suggest  as  the  only  remedy  for  low  wages,  due  to  these 
conditions,  the  enactment  of  a  national  minimum  wage  law. 

Second:  Under  the  second  cause  of  industrial  unrest — 
unemployment — we  have  seasonal  occupations,  as,  for  exam- 
ple, ice  cutting  and  logging  in  winter,  harvesting  and  fruit 
picking  in  summer. 

This  problem  will  always  be  with  us,  and  should  be  dealt 
with  through  an  efficient  system  of  national  employment 
agencies,  to  be  administered  by  the  Federal  Government. 

Private  employment  agencies  have  proved  inadequate ;  have 
even  in  many  cases  been  used  to  exploit  the  worker.  I  there- 
fore strongly  recommend  that  all  employment  agencies  be 
managed  by  the  Government. 

We  have,  also,  unemployment  due  to  periods  of  depression. 
The  Federal  employment  agencies  would  take  care  of  these 
cases,  bringing,  when  possible,  the  man  and  the  job  together, 
but  in  periods  of  long  depression,  when  no  work  is  to  be 


445 

found,  Government,  State,  and  municipal  work,  which  had 
been  held  in  reserve  for  this  purpose,  should  then  be  pro- 
vided. 

Should  all  these  resources  be  exhausted  and  there  still  re- 
main unemployed  workers,  there  should  be  Government  con- 
centration camps  where  work  with  a  small  wage  would  be  pro- 
vided, supplemented  by  agricultural  and  industrial  training. 

The  fear  of  unemployment  because  of  accident  or  illness 
fosters  a  feeling  of  discontent  which  tends  to  cause  industrial 
unrest. 

Workmen's  compensation  laws  and  sickness  insurance,  with 
proper  restrictions,  would  be  the  proper  correctives  here. 

Workmen's  compensation  laws  thus  far  developed  protect 
the  man  only  when  accident  occurs  during  working  hours, 
and  this  is  paid  for  entirely  by  the  employer.  If  an  accident 
occurs  causing  injury  to  a  man  just  before  entering  his  work 
place,  the  consequent  loss  to  his  family  is  just  as  great  as 
though  he  had  been  hurt  five  minutes  later  within  the  factory 
walls,  and  yet  he  receives  nothing. 

I  therefore  recommend  that  the  workmen's  compensation 
law  should  provide  insurance  against  accident  wherever  and 
whenever  caused.  This  insurance,  however,  should  be  paid  by 
the  man  himself,  his  employer,  and  the  Government  jointly. 
The  same  idea  should  apply  also  to  sickness  insurance. 

The  worker  himself  should  feel  these  responsibilities  and 
should  always  share  the  expense  of  such  insurance. 

Third :  We  have,  as  the  third  cause  for  industrial  unrest, 
the  development  of  large  industries  with  their  absentee  owner- 
ship. Large  business,  properly  controlled,  is  an  economic 
benefit,  but  the  very  size  makes  coordination  between  the  em- 
ployers and  workers  most  difficult.  There  is  no  personal  con- 
tact, hence  a  lack  of  sympathy  and  understanding. 

Where  a  few  cents  per  day  in  the  wage  of  the  individual 
workman  means  hundreds  of  thousands  of  dollars  annually 
to  the  business,  and  where  there  are  so  many  units  that  one 
foreman  can  be  pitted  against  another  to  maintain  the  cost  of 


446 

production  at  the  lowest  possible  point,  the  natural  tendency 
is  to  depress  the  wage. 

As  to  the  remedy,  I  would  suggest  that  all  corporations 
doing  interstate  business  be  required  to  take  out  a  National 
charter  that  will  entail  certain  responsibilities  and  possibly 
grant  certain  immunities  from  State  control. 

This  charter  should  not  allow  overcapitalization.  Each 
board  of  directors,  in  addition  to  its  other  committees,  should 
have  a  Labor  Committee  whose  duty  it  should  be  to  become 
thoroughly  acquainted  with  the  labor  conditions  of  the  busi- 
ness, and  make  regular  reports  thereon  to  the  board.  These 
reports  should  be  published  with  the  financial  and  other  re- 
ports, and  thus  give  the  stockholders  a  thorough  understand- 
ing of  the  business. 

Fourth :  Long  working  hours  and  insanitary  conditions  are 
additional  factors  in  the  problem  of  industrial  unrest.  Noth- 
ing affects  the  man's  physical  well-being,  and  consequently  his 
earning  power,  more  than  these. 

The  remedy  will  be  found  in  publicity  and  legislation,  with 
factory  inspection  by  competent  Government  officers. 

Personal  experience  for  a  number  of  years  convinces  me 
that  in  continuous  occupation,  workmen  will  do  more  work 
and  better  work  on  an  eight-hour  basis  than  on  twelve,  and 
that  one  day  in  seven  for  rest  must  be  allowed  if  the  man  is 
to  develop  the  fullest  degree  of  efficiency. 

I  therefore  favor  a  National  eight-hour  law  for  continuous 
labor. 

Sanitary  conditions  of  work  I  have  found  to  be  a  paying 
proposition  to  the  employer,  as  well  as  just  and  beneficial  to 
the  worker. 

Fifth:  With  regard  to  unsatisfactory  rural  conditions,  I 
view  with  real  concern  the  fact  that  our  small  land  owners 
are  becoming  tenants,  while  the  small  farms  are  passing  into 
the  hands  of  a  few. 

Everything  possible  should  be  done  to  aid  and  encourage  our 


447 

farmers;  the  United  States  Government  should  adopt  a  plan 
for  the  scientific  distribution  of  our  agricultural  products, 
and  for  a  rural  credit  system,  as  it  is  practiced  today  in  some 
foreign  countries. 

Unsatisfactory  rural  conditions  which  make  it  difficult  for 
the  small  farmer  to  earn  a  decent  livelihood  for  his  family, 
cause  many  poorly  equipped  young  men  and  women  to  flock 
to  the  cities.  As  a  rule,  they  are  thoroughly  inefficient  and 
lamentably  ignorant  of  the  temptations  of  city  life,  and  are 
rarely  able  to  earn  a  living  wage. 

Life  on  the  farm  should  be  made  sufficiently  attractive  and 
lucrative  to  induce  these  boys  and  girls  to  remain  there.  This 
can  be  done  only  through  our  rural  schools,  which  are  now 
most  inadequate. 

The  education  of  country  children  must  fit  them  for  country 
life.  No  love  of  the  beautiful,  no  patriotic  gratitude  to  his 
country  for  his  education,  can  be  felt  by  the  child  who  spends 
weary  months  in  uncomfortable  hovels,  where  he  receives  im- 
practical and  frequently  useless  instruction. 

Our  Government  should  aid  the  States  in  establishing  com- 
fortable rural  schools,  with  longer  terms  and  with  better-paid 
and  better-equipped  teachers. 

In  every  rural  school  there  should  be  departments  of  house- 
hold arts — that  is,  cooking,  sewing  and  millinery — and  manual 
training  and  agriculture.  These  schools  should  be  open  for 
agricultural  instruction  throughout  the  summer — in  fact,  each 
one  should  become  an  experiment  station  for  the  neighbor- 
hood. The  school  house  should  be  the  social  center — the  meet- 
ing ground  for  instruction  and  social  pleasures. 

In  order  to  satisfactorily  carry  out  the  suggestions  con- 
tained in  this  report,  it  would  be  necessary  to  have  a  non- 
partisan commission  in  charge  of  industrial  questions,  as  sug- 
gested by  the  majority  report  of  this  Commission. 

This  would  require  large  additional  revenue,  which  must 
be  derived  by  some  form  of  taxation. 

The  fairest  of  all  taxes  are  the  income  and  inheritance  taxes. 


448 

This  question,  however,  must  be  carefully  studied  and  weighed, 
since  the  tax  is  paid  by  one  class  while  the  benefits  are  largely 
enjoyed  by  another. 

Care  should  be  taken  that  it  does  not  become  confiscatory, 
and  thus  stifle  individual  incentive  and  effort. 

In  addition,  I  believe  that  every  individual  should  pay  his 
proportion,  no  matter  how  small  it  may  be.  It  will  inspire 
in  him  a  feeling  of  citizenship  and  make  him  an  integral  part 
of  our  Nation. 

S.  Thruston  Ballard. 


Lt 


University  of  California 
SOUTHERN  REGIONAL  LIBRARY  FACILITY 

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